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Baldwin Enterprises has two service departments, Personnel and Legal, and two operating divisions, Eastern and Western. Personnel costs are allocated on the basis of employees and Legal costs are allocated on the basis of hours. A summary of Baldwin operations ollows: Employees Hours Department direct costs Required A Required B Required C Complete this question by entering your answers in the tabs below. Department costs Personnel allocation. Legal allocation Total costs Personnel Personnel $ 10,800 $ 300,000 Required: a. Allocate the cost of the service departments to the operating divisions using the direct method. b. Allocate the cost of the service departments to the operating divisions using the step method. Start with Legal. c. Allocate the cost of the service departments to the operating divisions using the reciprocal method. 0 $ Legal Allocate the cost of the service departments to the operating divisions using the direct method. Note: Amounts to be deducted should be indicated by minus sign. Legal 0 $ Eastern $ 160,000 0 $ 40 Western Eastern 120 5,400 $ 1,200,000 0 Western 40 1,800 $ 790,000

Baldwin Enterprises has two service departments, Personnel and Legal, and two operating divisions, Eastern and Western. Personnel costs are allocated on the basis of employees and Legal costs are allocated on the basis of hours. A summary of Baldwin operations ollows: Employees Hours Department direct costs Required A Required B Required C Complete this question by entering your answers in the tabs below. Department costs Personnel allocation. Legal allocation Total costs Personnel Personnel $ 10,800 $ 300,000 Required: a. Allocate the cost of the service departments to the operating divisions using the direct method. b. Allocate the cost of the service departments to the operating divisions using the step method. Start with Legal. c. Allocate the cost of the service departments to the operating divisions using the reciprocal method. 0 $ Legal Allocate the cost of the service departments to the operating divisions using the direct method. Note: Amounts to be deducted should be indicated by minus sign. Legal 0 $ Eastern $ 160,000 0 $ 40 Western Eastern 120 5,400 $ 1,200,000 0 Western 40 1,800 $ 790,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Baldwin Enterprises has two service departments, Personnel and Legal, and two operating divisions, Eastern and Western. Personnel costs are allocated on the basis of employees and Legal costs are allocated on the basis of hours. A summary of Baldwin operations follows: Employees Hours Department direct costs Required A Required B Required C Complete this question by entering your answers in the tabs below. Department costs Personnel allocation Legal allocation Total costs Personnel Personnel $ 10,800 $ 300,000 Required: a. Allocate the cost of the service departments to the operating divisions using the direct method. b. Allocate the cost of the service departments to the operating divisions using the step method. Start with Legal. c. Allocate the cost of the service departments to the operating divisions using the reciprocal method. 0 $ Legal Allocate the cost of the service departments to the operating divisions using the direct method. Note: Amounts to be deducted should be indicated by a minus sign. Legal 0 $ Eastern $ 160,000 0 $ 40 Western Eastern 120 5,400 $ 1,200,000 0 Western 40 1,800 $ 790,000
Transcribed Image Text:Baldwin Enterprises has two service departments, Personnel and Legal, and two operating divisions, Eastern and Western. Personnel costs are allocated on the basis of employees and Legal costs are allocated on the basis of hours. A summary of Baldwin operations follows: Employees Hours Department direct costs Required A Required B Required C Complete this question by entering your answers in the tabs below. Department costs Personnel allocation Legal allocation Total costs Personnel Personnel $ 10,800 $ 300,000 Required: a. Allocate the cost of the service departments to the operating divisions using the direct method. b. Allocate the cost of the service departments to the operating divisions using the step method. Start with Legal. c. Allocate the cost of the service departments to the operating divisions using the reciprocal method. 0 $ Legal Allocate the cost of the service departments to the operating divisions using the direct method. Note: Amounts to be deducted should be indicated by a minus sign. Legal 0 $ Eastern $ 160,000 0 $ 40 Western Eastern 120 5,400 $ 1,200,000 0 Western 40 1,800 $ 790,000
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