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Question 1 Alkatras Ltd., a drone manufacturer, has two operating departments manufacturing unit and distribution centerand two support departmentshuman resources and information systems. The operations

Question 1

Alkatras Ltd., a drone manufacturer, has two operating departments manufacturing unit and distribution centerand two support departmentshuman resources and information systems. The operations of the manufacturing and distribution center are performed independently. Alkatras uses number of employees to allocate human resources costs and processing time to allocate information systems costs. The following data are available for December 2022:

SUPPORT

DEPARTMENTS

OPERATING

DEPARTMENTS

Human

Resources

Information Systems Manufacturing unit Distribution center
Budgeted costs incurred before any interdepartmental cost allocations $92,500 $334,600 $898,970 $587,420
Support work supplied by human resources department
Budgeted number of employees 18 51 32
Support work supplied by information systems department
Budgeted processing time (in minutes) 405 1,620 1,500

  1. Allocate the support departments' costs to the operating departments using the direct method.

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