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
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 Machine-hours Personnel 1,000 Labor-hours Department direct costs 500 $5,000 Printing 1,000 500 Developing 3,000 $12,000 $15,000 2,000 $10,000 Required: Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.) Service department costs Maintenance allocation Maintanance Personnel Printing Developing Personnel allocation Total costs allocated $ 0 $ 0 $ 0 $
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