Author Question: Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of ... (Read 160 times)

maychende · **on:** Mar 6, 2021

Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $320,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $200,000 are allocated based on the number of employees. The costs of operating departments A and B are $208,000 and $312,000, 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	$320,000	$200,000	$208,000	$312,000
Budgeted maintenance-hours	NA	860	1230	690
Number of employees	50	NA	270	630

Using the step-down method, what amount of Maintenance Department cost will be allocated to Department B if the service department with the highest percentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations.)
◦ $31,079
◦ $79,424
◦ $49,640
◦ $88,489

Edwyer · **Reply #1 on:** Mar 6, 2021

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