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Techy Trendy Company (TTC) creates generic computer chips using high-tech machinery. TTC has two service departments (IT and Legal) that provide services for one another
Techy Trendy Company (TTC) creates generic computer chips using high-tech machinery. TTC has two service departments (IT and Legal) that provide services for one another as well as for two production departments, Fabrication and Finishing. Data for the month follow: IT Legal Fabrication Finishing 2 8 30 20 IT Support Tickets Legal Inquiries 6 4 20 10 IT Department costs for the month were $120,000, and Legal Department costs were $150,000. TTC uses IT support tickets as the assignment base for IT Department costs and uses legal inquiries as the assignment base for Legal Department costs. What amount of overhead would be allocated to the Fabrication and Finishing department using the step-down method, with IT costs assigned first? In order for the solution to balance out with the original amount of support department cost, DO NOT round intermediate calculations. O Fabrication: $172,000; Finishing: $98,000 O Fabrication: $173,103.45; Finishing: $96,896.55 O Fabrication: $170,333.33; Finishing: $99,666.67 O Fabrication: $171,470.59; Finishing: $98,529.41
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