partial credit,E15-19 (similar to)

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ManhattanManhattan

Partners provides management consulting services to government and corporate clients.

ManhattanManhattan

has two support

departmentslong dashadministrative

services? (AS) and information systems

?(IS)long dashand

two operating

departmentslong dashgovernment

consulting? (GOVT) and corporate consulting? (CORP). For the first quarter of

20132013?,

Manhattan'sManhattan's

cost records indicate the? following:

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?(Click the icon to view the cost? records.)Read the requirements

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.

Requirement 1a. Allocate the two support? departments' costs to the two operating departments using the direct method. ?(Do not round interim calculations and round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Enter a? "0" for any zero? balances.)

	Support Departments		Operating Departments
Direct Method	AS	IS	GOVT	CORP	Total
Budgeted overhead costs
before interdepartment cost allocations	$330,000	$2,400,000	$7,325,000	$12,580,000	$22,635,000
Allocation of AS costs	(330,000)		214,500	115,500
Allocation of IS costs		(2,400,000)	960,000	1,440,000
Total budgeted overhead of operating departments	$0	$0	$8,499,500	$14,135,500	$22,635,000

Requirement 1b. Allocate the two support? departments' costs to the two operating departments using the? step-down method? (Allocate AS? first). ?(Do not round interim calculations and round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Enter a? "0" for any zero? balances.)

	Support Departments		Operating Departments
Step-down Method	AS	IS	GOVT	CORP	Total
Budgeted overhead costs
before interdepartment cost allocations	$330,000	$2,400,000	$7,325,000	$12,580,000	$22,635,000
Allocation of AS costs	(330,000)	66,000	171,600	92,400
	$0	2,466,000
Allocation of IS costs		(2,466,000)	986,400	1,479,600
Total budgeted overhead of operating departments		$0	$8,483,000	$14,152,000	$22,635,000

Requirement 1c. Allocate the two support? departments' costs to the two operating departments using the? step-down method? (Allocate IS? first). ?(Do not round interim calculations and round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Enter a? "0" for any zero? balances.)

	Support Departments		Operating Departments
Step-down Method	AS	IS	GOVT	CORP	Total
Budgeted overhead costs
before interdepartment cost allocations	$330,000	$2,400,000	$7,325,000	$12,580,000	$22,635,000
Allocation of IS costs	240,000	(2,400,000)	864,000	1,296,000
	$570,000	$0
Allocation of AS costs	(570,000)		370,500	199,500
Total budgeted overhead of operating departments	$0		$8,559,500	$14,075,500	$22,635,000

Requirement 2. Compare and explain differences in the? support-department costs allocated to each operating department.

Begin by entering the total? support-department costs allocated to each operating department under each of the methods below.

	GOVT	CORP
Direct method
Step-down (AS first)
Step-down (IS first)

Requirements 2-3