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Goldfarb's Book and Music Store has two service departments (Warehouse, and Data Center) and two operating departments (Music, and Books). - Warehouse Department costs of
Goldfarb's Book and Music Store has two service departments (Warehouse, and Data Center) and two operating departments (Music, and Books). - Warehouse Department costs of $ 480000 are allocated on the basis of budgeted warehouse-hours. - Data Center Department costs of $250000 are allocated based on the number of computer log-on hours. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Budgeted costs Budgeted warehouse-hours (by Warehouse Dept.) Production Departments Warehouse Department Data Center Department Music Books $ 480000 $ 250000 $125000 $150000 500 1000 1500 Budgeted computer log-on hours 200 (by Data Center Dept.) 800 1000 (For each item below write your answers inside the boxes.) a) Using the direct method, what amount of Warehouse Department costs will be allocated to Department Books? Ans = $ b) Using the step-down method, and allocating Data Center Department costs first, what amount of Data Center Department cost will be allocated to Department Music? Ans = $
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