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Step method allocation problem for Managerial Accounting is attached. Eye Medical Clinic has two service departments, Building Services and Energy, and three operating departments, Pediatrics,
Step method allocation problem for Managerial Accounting is attached.
Eye Medical Clinic has two service departments, Building Services and Energy, and three operating departments, Pediatrics, Geriatrics, and Surgery. Eye Medical allocates the cost of Building Services on square footage and Energy on patient days. No distinction is made between variable and fixed costs. Budgeted operating data for last year follow: Service Departments Building Energ Services y Operating Departments Pediatrics Geriatrics Surgery Budgeted costs before allocation.................................................................................................... $90,000 $18,000 $8,000 $80,000 $50,000 Square footage............................................................................................... 12,000 1,000 4,000 6,000 18,000 Patient days.................................................................................................... --5,500 7,700 8,800 Required: Prepare a schedule to allocate service department costs to operating departments by the step-down method, allocating Building Services first. (Round all dollar amounts to the nearest whole dollar.)Step by Step Solution
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