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The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs
The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs Number of employees Square feet of space occupied Hours of press time Service Departments Administration Janitorial Maintenance $ 165,200 $ 123,900 $ 56,640 60 140 15,000 20,000 35 10,000 Operating Departments Binding $ 324,500 315 40,000 30,000 Printing $ 507,400 210 100,000 60,000 Total $ 1,177,640 760 185,000 90,000 The company allocates service department costs by the step-down method in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time). Required: Using the step-down method, allocate the service department costs to the operating departments. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.) Service Departments Administration Janitorial Maintenance Operating Departments Binding Printing Total Departmental costs before allocations $ 165,200 $ 123,900 $ 56,640 $ 324,500 $ 507,400 $ 1,177,640 Allocations: Administration costs Janitorial costs Maintenance costs Total costs after allocations $ 165,200 $ 123,900 $ 56,640 $ 324,500 $ 507,400 $ 1,177,640
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