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Determine and compare support department cost allocations under the step. direct, and reciprocal methods. P 1 4 . 1 ( L 0 1 , 2
Determine and compare support department cost allocations under the step. direct, and reciprocal methods.
PL AP Excel Business Writing After starting his first fulltime position for a private company. Ronin was anxious to go above and beyond the expectations of his supervisor. So when Sondra asked him to complete the support department cost allocations for all departments using the same method as they used last year he thought, "Here's my chancel" In addition to the step method that this company was currently using. Ronin remembered learning two other methods for allocating these costs the direct method and the reciprocal method.
The two operating segments of this company reflect their locations Suburban and Downtown. The two support departments are Administrative Services and Maintenance Services. Their costs have been allocated by administrative hours and maintenance hours, respectively. Here are the relevant costs and usages for all four of these departments.
tabletableOriginal costAdministrativehours usedSupport Departments,tableOperatingDepartmentsAdministrativeMaintenance,Suburban,Downtown$$$$
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