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Bucky Company has a Maintenance Department that services the equipment in only three operating departments: Cutting, Forming. and Painting Departments. The cost of this servicing
Bucky Company has a Maintenance Department that services the equipment in only three operating departments: Cutting, Forming. and Painting Departments. The cost of this servicing is charged to the operating departments on the basis of machine-hours. Data relating to the Maintenance Department costs are below. Variable costs Fixed costs Actual $44,683 $30,200 Budgeted $45,000 $28.100 Data for the three operating departments follow. Budgeted Machine Hours Actual Machine Hours Long-run average Machine-Hours Cutting 3,000 2,870 2.800 Forming 7,500 7,490 7,200 Painting 4,500 4,350 4,000 Q: How much, if any, of the actual Maintenance Department costs should NOT be charged to the three operating departments for evaluation purposes? A:$
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