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PQR Ltd has two production departments Machining and Finishing. There are three service departments: Human Resource, Maintenance and Design. The budgeted Cost in these service
PQR Ltd has two production departments Machining and Finishing. There are three service departments: Human Resource, Maintenance and Design. The budgeted Cost in these service departments are as follows: Particulars Variable Fixed Total HR 1,00,000 4,00,000 5,00,000 Maintenance 1,60,000 3,00,000 4,60,000 In $ Design 1,00,000 6,00,000 7,00,000 The usage of these service departments' output during the year completed are as follows: In Hours of service User of service Provider of Service HR Maintenance Design HR Maintenance Design Machining Finishing 500 500 4000 5000 10,000 500 3500 4000 8000 4500 1500 6000 Total Required: 1) Use direct method to reapportion PQR Ltd.'s Service departments to its production departments: 2) Use Step-down method to reapportion the firm's service department cost
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