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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 service
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 TO Purchasing Maintenance Fabrication Assembly 62 354 50% 15% 45% 0% 45% 198 The direct operating costs of the departments (including both variable and fixed costs) were follows Purchasing Maintenance Fabrication Assembly $102,000 24,000 78,000 54,000 The total cost accumulated in the fabrication department using the step method is (assume the purchasing department goes first 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 $172.395. $177,845 $80,155 $92605 $85.855.
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