Q2. Z&C has two support departments, A1 and A2, and two operating departments, B1 and B2. Z&C
Question:
Q2. Z&C has two support departments, A1 and A2, and two operating departments, B1 and B2. Z&C has decided to use the direct method and allocate variable A1 dept. costs based on the number of transactions and fixed A1 dept. costs based on the number of employees. A2 dept. variable costs will be allocated based on the number of service requests and fixed costs will be allocated based on the number of computers. The following information is provided: (CH 8, 2.5 Marks)
| Support Departments | Operating Departments | ||
| A1 | A2 | B1 | B2 |
Total Department variable costs | 5,000 | 6,000 | 38,000 | 21,000 |
Total department fixed costs | 5,800 | 11,000 | 42,000 | 18,000 |
Number of transactions | 15 | 18 | 80 | 45 |
Number of employees | 5 | 7 | 15 | 12 |
Number of service requests | 12 | 7 | 15 | 10 |
Number of computers | 6 | 8 | 10 | 12 |
Allocate variable and fixed costs.
Answer: