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I would really appreciate it if the answers are answers in a very detailed way possible. Bob's Manufacturing has two production departments, Fabrication and Assembly,
I would really appreciate it if the answers are answers in a very detailed way possible.
Bob's Manufacturing has two production departments, Fabrication and Assembly, and two service departments, Material Handling, Power Generation, and Accounting. The following table shows the costs incurred by each service department as well as the usage of their cost allocation bases among all departments. Material Handling costs are allocated by pounds of material used, Power Generation costs are allocated by Kilowatt-hours (Kwhr), and Accounting costs are allocated by hours spent in the accounting department on each department. Power Generation $4,000 Accounting $12,000 Fabrication Assembly Material Handling $10,000 30 750 100 20 Traceable costs Pounds of material Power used (Kwhr) Accounting hours 30 150 600 50 450 300 150 100 100 50 a. Allocate service department costs to operating departments using the direct method. b. Allocate service department costs to operating departments using the step-down method, with Material Handling allocated first. C. Allocate service department costs to operating departments using the reciprocal methodStep by Step Solution
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