Required information

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The following information is departmental cost allocation with two service departments and two production departments.

				Percentage Service Provided to
Department	Cost			S1			S2			P1			P2
Service 1 (S1)	$	30,000			0	%		30	%		35	%		35	%
Service 2 (S2)		20,000			20			0			20			60
Production 1 (P1)		100,000
Production 2 (P2)		150,000

What is the amount of service department cost allocated to P1 and P2 using the direct method if the cost in P1 is changed from $100,000 to $120,000?

Total Cost AllocatedP1$140,000selected answer incorrectP2$180,000selected answer incorrect