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Cerce Corporation uses the direct method to allocate service department costs to operating departments. The company has two service departments, Administrative and Facilities, and two
Cerce Corporation uses the direct method to allocate service department costs to operating departments. The company has two service departments, Administrative and Facilities, and two operating departments, Assembly and Finishing. Departmental costs Employee hours Space occupied--square feet Service Department Administrative Facilities $ 30,600 $ 39,765 3,100 1, 210 8,100 1,210 Operating Department Assembly Finishing $ 125,860 $ 417,650 21,000 21,000 22,000 2,100 Administrative Department costs are allocated on the basis of employee hours and Facilities Department costs are allocated on the basis of space occupied. Required: Allocate the service department costs to the operating departments using the direct method. Service Department Administrative Facilities Operating Department Assembly Finishing Total costs after allocation
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