Question
Bricks and Mortar Manufacturing produces building materials for local construction contractors. BMM has 2 production departments (Mixing and Firing) and 2 service departments (Maintenance and
Bricks and Mortar Manufacturing produces building materials for local construction contractors. BMM has 2 production departments (Mixing and Firing) and 2 service departments (Maintenance and Cleaning). Maintenance costs are allocated based on machine hours used. Cleaning costs are allocated based on square feet of floor space. BMM also allocates depreciation on the factory to all departments on the basis of number of employee positions in the department.
The following data is available for BMM:
Mixing: 600 square feet of floor space, 200 machine hours used, 10 employees
Firing: 400 square feet of floor space, 500 machine hours used, 5 employees
Maintenance: $4,900 incurred, 4 employees
Cleaning: $2,300, 6 employees
Depreciation on factory: $4,500
How much in total costs should be allocated to the Mixing department?
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