1 Hessel Corporation has two operating departments (Domestic and Global) and three service departments: Human Resources (HR), Legal, and Testing. In the most recent period, the following costs and service department usage ratios were recorded: 02:25:09 eBook Supplying Department Human Resources Legal Testing Direct cost Required: Human Resources Legal Using Department Testing Domestic Global 0 10% 15% 0 10% 25% 50% 0 30% 60% 10% 0 0 45% 45% $ 264,500 $ 190,000 $ 90,000 $ 556,000 $ 505,000 Allocate the service department costs to the two operating departments using the reciprocal method. Note: Do not round intermediate calculations. Allocated to: From: Costs Domestic Global Human Resources Legal Testing Total
1 Hessel Corporation has two operating departments (Domestic and Global) and three service departments: Human Resources (HR), Legal, and Testing. In the most recent period, the following costs and service department usage ratios were recorded: 02:25:09 eBook Supplying Department Human Resources Legal Testing Direct cost Required: Human Resources Legal Using Department Testing Domestic Global 0 10% 15% 0 10% 25% 50% 0 30% 60% 10% 0 0 45% 45% $ 264,500 $ 190,000 $ 90,000 $ 556,000 $ 505,000 Allocate the service department costs to the two operating departments using the reciprocal method. Note: Do not round intermediate calculations. Allocated to: From: Costs Domestic Global Human Resources Legal Testing Total
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Hessel Corporation has two operating departments (Domestic and Global) and three service departments: Human Resources (HR),
Legal, and Testing. In the most recent period, the following costs and service department usage ratios were recorded:
02:25:09
eBook
Supplying Department
Human Resources
Legal
Testing
Direct cost
Required:
Human Resources
Legal
Using Department
Testing
Domestic
Global
0
10%
15%
0
10%
25%
50%
0
30%
60%
10%
0
0
45%
45%
$ 264,500
$ 190,000
$ 90,000
$ 556,000
$ 505,000
Allocate the service department costs to the two operating departments using the reciprocal method.
Note: Do not round intermediate calculations.
Allocated to:
From:
Costs
Domestic
Global
Human Resources
Legal
Testing
Total
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