Question
University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the
University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. |
The following data appear in the company records for the current period: |
Maintenance | Personnel | Printing | Developing | |||||||||||||
Machine-hours | ? | 1,000 | 1,000 | 3,000 | ||||||||||||
Labor-hours | 500 | ? | 500 | 2,000 | ||||||||||||
Department direct costs | $ | 15,000 | $ | 36,000 | $ | 45,000 | $ | 30,000 | ||||||||
Required: | ||||||||||||||||||||||||||||||
Allocate the service department costs using the reciprocal method. (Matrix algebra is not required because there are only two service departments.) (Do not round intermediate calculations. Round your answers to the nearest dollar amount.)
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