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Problem 4 [12 marks] Fraser University offers only high-tech graduate-level programs. Fraser has two principal operating departments, Engineering and Computer Sciences, and two support departments,
Problem 4 [12 marks] Fraser University offers only high-tech graduate-level programs. Fraser has two principal operating departments, Engineering and Computer Sciences, and two support departments, Maintenance and Enrollment Services. The base used to allocate Maintenance is budgeted total maintenance hours. The base used to allocate Enrollment Services is number of credit hours for a department. The following chart summarises budgeted amounts and allocation-base amounts used by each department: Budget Engineering Computer Sciences Maintenance Enrollment Services Engineering $120 000 Computer Sciences $160 000 Maintenance (in hours) $350 000 120 230 350 Enrollment Services (in credit hours) $140 000 440 260 100 Required What are the total costs of the two principal operating departments after the support department costs have been allocated using: a. the direct method [4 marks] b. the step-down method (allocate Maintenance first) [4 marks] c. the reciprocal method [4 marks]
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