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The Merchant Manufacturing Company has two service departments - purchasing and maintenance, and two production departments - fabrication and assembly. The distribution of each
The Merchant Manufacturing Company has two service departments - purchasing and maintenance, and two production departments - fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below: FROM Purchasing Maintenance Te're Purchasing Maintenance 60% 20% Fabrication 10% Assembly 30% 30% 50% The direct operating costs of the departments (including both variable and fixed costs) were as follows: Purchasing Maintenance Fabrication $96,000 18,000 72,000 Assembly 48,000 The total cost accumulated in the assembly department using the direct method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar): Multiple Choice $102,750. $85,800. $114,600. $135,000. $131,250.
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