Question
J Co. has two service departments and two production departments ( A and B). Data provided are as follows: Direct cost of Department A and
J Co. has two service departments and two production departments ( A and B). Data provided are as follows: Direct cost of Department A and Department B are 6,000 and 7,500, respectively. Cost of service dept 1 and 2 are 400 and 700, respectively. Services performed by Service Dept 1 to Service Dept 2, Department A and Department B are 40%, 40% and 20%, respectively. Services performed by Service Dept 2 to Service Dept 1, Department A and Department B are 20%, 70% and 10%, respectively. Assuming step down method is used to allocate service department cost, what is the total cost of department A?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started