Author Question: Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of ... (Read 105 times)

lb_gilbert · **on:** Mar 6, 2021

Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $350,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $110,000 are allocated based on the number of employees. The costs of operating departments A and B are $184,000 and $276,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows:
Production

Support Departments

Departments

	Maintenance Department	Personnel Department	A	B
Budgeted costs	$350,000	$110,000	$184,000	$276,000
Budgeted maintenance-hours	NA	840	1230	630
Number of employees	55	NA	290	650

Using the step-down method, what amount of Maintenance Department cost will be allocated to Department A if the service department with the highest percentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations.)
◦ $231,452
◦ $121,677
◦ $50,111
◦ $159,444

adf223 · **Reply #1 on:** Mar 6, 2021

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