Problem 2: Cost Allocation: Direct Method (10 points):

Costalot Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of November follow:

DepartmentDirect CostsMaintenance.Cafeteria.Machining.Assembly

Machining.$109,000

Assembly67,000

Maintenance55,00030%50%.20%

Cafeteria36,000.75%15%.10%

Compute the allocation of the service departments' costs to producing departments using the direct method.