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Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations: Using
Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations:
"Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Adminastration first on the basis of employee-hours and then Janitorial on the basis of space occupied"
Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations Service Departments Administration Janitorial Operating Departments Groceries Departmental costs before allocations Employee-hours Space occupied-square feet $200,000 490 1,000 Gifts $70,000 $3,820,000 $350,000 150 500 330 2,720 9,500 1,300 Required: Using the step-down method, allocate the costs of the service departments to the two operating departments Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Operating Departments Service Departments Administration Janitorial Groceries Gifts Total Departmental costs before allocations Allocation S 200,000 $ 70,0003 3,820,000 S 350,000 S 4,440,000 Administration costs Janitorial costs (200,000) 256,200 (70,000) Total costs after allocation$ 0 4,076,200! $ 350,0001 4,426,200Step by Step Solution
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