Question
Can you explain those answers? Answers below The Dexter Manufacturing Company has two production departments (Assembly and Finishing) and two service departments (Human Resources and
Can you explain those answers? Answers below
The Dexter Manufacturing Company has two production departments (Assembly and Finishing) and two service departments (Human Resources and Janitorial). The projected usage of the two service departments is as follows:
Use of Human Resources Use of Janitorial
Human Resources ------ 5%
Janitorial 10% ------
Assembly 60% 40%
Finishing 30% 55%
The budgeted costs in the service departments are: Human Resources, $90,000 and Janitorial, $50,000.
27. Using the direct method, the amount of Janitorial Department cost allocated to the Finishing Department is: Answer is D. $28,947.
29. Using the step-down method and assuming the Human Resources Department is allocated first, the total amount of service department cost allocated to the Finishing Department is: Answer is B. $61,158.
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