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Questions 6 and 7 are based on the following information: XYZ's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department
Questions 6 and 7 are based on the following information: XYZ's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $300,000 are allocated on the basis of budgeted warehouse-hours. Data Center Department costs of $100,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $160,000 and $240,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Production Departments Warehouse Data Center Department Department Music Books Budgeted costs $300,000 $100,000 $160,000 $240,000 Budgeted warehouse hours NA 800 1,200 600 Number of computer hours 50 NA 200 600 1 pts Using the direct method, what amount of Warehouse department costs will be allocated to the Music Department? $138,462 $106,667 $120,000 $200,000 $75,000 D Question 7 1 pts Using the step-down method, what total amount of support department cost will be allocated to Books Department? Allocate the Data Center Department first. $175,000 $170,588 $172,549 $186,538 $139,820
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