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Dolphin Company has two service departments, S1 and 52 and three production departments, P1, P2 and P3. The following data relate to Dolphin Company's allocation
Dolphin Company has two service departments, S1 and 52 and three production departments, P1, P2 and P3. The following data relate to Dolphin Company's allocation of service department costs: Cost Number of Employees Kilowatt Hours S1 80,000 2 600 S2 40,000 3 400 P1 100,000 3 500 P2 800,000 6 1,000 P3 1,200,000 6 2,500 S1 allocates its costs on the basis of number of employees. S2 allocates its costs on the basis of kilowatt hours. The order of allocation for Dolphin Company is S1 first and S2 second. Dolphin Company uses the direct method to allocate its service department costs. Problem 3-2 The allocation of costs from $1 to P2 would be: O $25,000 $32.000 O $24,000 O $26,667
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