Exercise 11-26 & 11-27 (LO 11-2)

[The following information applies to the questions displayed below.]

Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of August follow:

Proportion of Services Used by

Department

Direct Costs

Maintenance

Cafeteria

Machining

Assembly

Machining

$

105,000

Assembly

76,400

Maintenance

47,200

0.2

0.6

0.2

Cafeteria

38,000

0.8

0.1

0.1

Exercise 11-26 Cost Allocation: Direct Method (LO 11-2)

Required:

Compute the allocation of service department costs to producing departments using the direct method. (Do not round intermediate calculation

	Total Costs
Machining
Assembly