Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below: Costs Number of employees Square metres of space occupied Machine-hours Service Departments Equipment Administrative Janitorial Maintenance Prep Finishing Total $36,000 $256,100 $498,600 $950,500 $67,800 $92,000 80 60 240 600 300 1,280 300 1,200 1,000 2,000 11,500 7,000 54,000 80,000 26,000 The company allocates service department costs by the step-down method in the following order: Administrative (number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours). Departmental costs before allocations Allocations: Required: Using the step-down method, allocate the service department costs to the operating departments. (Negative amounts should be indicated by a minus sign.) Administrative Janitorial Maintenance Total costs after allocation $ Operating Departments Service Departments Administrative Janitorial Maintenance Prep 0 $ 0 $ 0 $ Operating Departments Finishing Total 0 $ 0
Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below: Costs Number of employees Square metres of space occupied Machine-hours Service Departments Equipment Administrative Janitorial Maintenance Prep Finishing Total $36,000 $256,100 $498,600 $950,500 $67,800 $92,000 80 60 240 600 300 1,280 300 1,200 1,000 2,000 11,500 7,000 54,000 80,000 26,000 The company allocates service department costs by the step-down method in the following order: Administrative (number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours). Departmental costs before allocations Allocations: Required: Using the step-down method, allocate the service department costs to the operating departments. (Negative amounts should be indicated by a minus sign.) Administrative Janitorial Maintenance Total costs after allocation $ Operating Departments Service Departments Administrative Janitorial Maintenance Prep 0 $ 0 $ 0 $ Operating Departments Finishing Total 0 $ 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
A-2
Transcribed Image Text:36
Arbon Company has three service departments and two operating departments. Selected data concerning the five
departments are presented below:
Costs
Number of employees
Square metres of
space occupied
Machine-hours
Service Departments
Equipment
Administrative Janitorial Maintenance Prep Finishing Total
$36,000 $256,100 $498,600 $950,500
$67,800
$92,000
80
60
240
600
300
1,280
300
1,200
1,000
2,000 7,000 11,500
26,000 54,000 80,000
The company allocates service department costs by the step-down method in the following order: Administrative
(number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours).
Departmental costs before
allocations
Allocations:
Required:
Using the step-down method, allocate the service department costs to the operating departments. (Negative amounts
should be indicated by a minus sign.)
Administrative
Janitorial
Maintenance
Total costs after allocation
$
Operating Departments
Service Departments
Administrative Janitorial Maintenance Prep Finishing Total
0 $
0 $
0 $
Operating
Departments
0 $
lo
0
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