[LO 7-3]

Departmental Cost Allocation Robinson Products Company has two service departments (S1 and S2) and two production departments (P1 and P2). The distribution of each service department's efforts (in percentages) to the other departments is:

To

FromS1S2P1P2

S110%20%?%

S210%?30

The direct operating costs of the departments (including both variable and fixed costs) are:

S1$180,000

S260,000

P150,000

P2120,000

Required

1.Determine the total cost of P1 and P2 using the direct method.

2.Determine the total cost of P1 and P2 using the step method.