Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate

Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department.

The following data appear in the company records for the current period:

IT HR Publishing Binding
IT tickets 0 1,400 1,400 4,200
Employees 32 0 40 56
Department direct costs $ 156,000 $ 247,500 $ 430,000 $ 390,000

Required:

Use the direct method to allocate these service department costs to the operating departments.

image text in transcribed

Woodstock BIndlng has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT TIckets (ISsued with each IT request) In each department and HR costs on the basIs of employees in each department. The following data appear in the company records for the current perlod: Required: Use the direct method to allocate these service department costs to the operating departments. Note: Amounts to be deducted should be Indlcated by a minus sign. Do not round Intermedlate calculatlons. Round "Publlshing" and "Binding" answers to 2 decimal places

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Auditing Real Issues And Cases

Authors: Michael C. Knapp

8th Edition

0538466790, 9780538466790

More Books

Students also viewed these Accounting questions

Question

What are the purposes of promotion ?

Answered: 1 week ago