Question
Tech Innovations Inc. is analyzing its support department costs using activity-based costing. The company identifies two support departments: Maintenance and Information Technology (IT). The total
Tech Innovations Inc. is analyzing its support department costs using activity-based costing. The company identifies two support departments: Maintenance and Information Technology (IT). The total budgeted costs for Maintenance are $200,000, and the total budgeted costs for IT are $150,000. The company allocates Maintenance costs based on machine hours and IT costs based on the number of users. If the company's production department uses 10,000 machine hours and has 50 users, calculate the allocation of support department costs to the production department.
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