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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: Departmental
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: Departmental costs before allocations Employee-hours Space occupied square feet Service Departments Administration Janitorial $150,000 $40,000 320 250 100 Operating Departments Groceries Gifta $2,320,000 $950,000 3, 100 740 4,000 1,000 160 Required: Using Matrix Algebra, allocate the costs of the service departments to the two operating departments. Allocate Administration on the basis of employee-hours and then Janitorial on the basis of space occupied. Use an LA Matrix taken to the fourth power. Service Departments Administration Janitorial S 150,000 $ 40.000 Operating Departments Groceries Gifts Total $ 2,320,000 $ 950,000 $3,460,000 Departmental costs before allocations Allocations Administration costs Janitorial costs Total costs after allocations
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