Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees,

image text in transcribed
BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees, and Accounting costs are allocated on the basis of number of transactions. A summary of BluStar operations follows Administration Domestic Accounting 25 Employees Transactions Department direct costs International 180 80,000 $3,600,000 25,000 $360,000 20,000 5936,000 $144,000 Required: a. Allocate the cost of the service departments to the operating departments using the direct method. b. Allocate the cost of the service departments to the operating departments using the step method. Start with Administration c. Allocate the cost of the service departments to the operating departments using the reciprocal method Complete this question by entering your answers in the tabs below. Required A Required B Required Allocate the cost of the service departments to the operating departments using the direct method. (Do not round Intermediate calculations. Negative amounts should be indicated by a minus sign.) Administration Accounting Domestic International From Department costs Administration allocation Accounting allocation Total cost $ 05 05 0 S Required B >

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions