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The Hsu Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $449,500 are allocated on the basis of machine hours.
The Hsu Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $449,500 are allocated on the basis of machine hours. The Accounting Department's costs of $138,000 are allocated on the basis of the number of employees within a specific department. The direct departmental costs for A and B are $350,000 and $550,000, respectively.
Maintenance | Accounting | A | B | |
Machine hours | 675 | 45 | 2,850 | 250 |
Number of employees | 2 | 2 | 8 | 4 |
What is the Maintenance Department's cost allocated to Department A using the direct method?
Multiple Choice
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$367,250.
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$523,650.
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$229,250.
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$413,250.
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