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Jackman Industries has two service departments, maintenance and power, and two operating departments, production and assembly. Management has decided to allocate maintenance costs on the

Jackman Industries has two service departments, maintenance and power, and two operating departments, production and assembly. Management has decided to allocate maintenance costs on the basis of direct-labor hours in each department and power costs on the basis of machine hours. The following data were experienced by the company in the current period:

Maintenance Power Production Assembly
Direct labor hours 0 400 4,000 2,000
Machine hours 2,000 0 8,400 1,600
Department direct costs $ 9,000 $ 20,000 $ 70,000 $ 50,000

What is the total service cost allocated to the production department during the period if the direct method of cost allocation is used?

$ 9,200 $22,800 $19,625 None of these. $ 6,200

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