Question 8

QUESTION 8 Fiona's Bicycles and Scooters Store has two service departments, Warehouse and Cleaning. The Warehouse Department costs of $420,000 are allocated on the basis of budgeted warehouse hours. Cleaning Department costs of $150,000 are allocated based on the number of labour hours in each department. The costs of the operating departments Bicycles and Scooters are $460,000 and $520,000, respectively. Data on budgeted warehouse-hours and number of labour hours are as follows: Support Departments Warehouse Cleaning Department Department $420,000 $150,000 NA 500 Production Departments Bicycles Scooters $460,000 $520,000 1,000 1,500 800 1,000 Budgeted costs Budgeted warehouse-hours Number of labour hours 200 NA What amount is allocated from Warehouse to Bicycles using the direct method? What amount is allocated from Cleaning to Bicycles using the step down method when Warehouse is allocated first? Do not include commas in your answer. Present $1,000 as $1000, Round answer to nearest whole dollar