Direct and step-down allocation. E-books, an online book retailer, has two operating departments- corporate sales and consumer sales-and two support departments-human resources and information systems. Each sales department conducts merchandising and marketing operations independently. E-books uses number of employees to allocate human resources costs and processing time to allocate information systems costs. The following data are available for September 2017: Page Layout Data Home Insert Formulas Review View в SUPPORT ID OPERATING DEPARTMENTS DEPARTMENTS Corporate Consumer Sales Sales Human Information Resources Systems 3 Budgeted costs incurred before any interdepartment cost allocations Support work supplied by human 5 resources department Budgeted number of employees Support work supplied by information 7 systems department Budgeted processing time (in minutes) $72,700 $234,400 $998,270 $489,860 4 21 42 28 8. 320 1,920 1,600
Direct and step-down allocation. E-books, an online book retailer, has two operating departments- corporate sales and consumer sales-and two support departments-human resources and information systems. Each sales department conducts merchandising and marketing operations independently. E-books uses number of employees to allocate human resources costs and processing time to allocate information systems costs. The following data are available for September 2017: Page Layout Data Home Insert Formulas Review View в SUPPORT ID OPERATING DEPARTMENTS DEPARTMENTS Corporate Consumer Sales Sales Human Information Resources Systems 3 Budgeted costs incurred before any interdepartment cost allocations Support work supplied by human 5 resources department Budgeted number of employees Support work supplied by information 7 systems department Budgeted processing time (in minutes) $72,700 $234,400 $998,270 $489,860 4 21 42 28 8. 320 1,920 1,600
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Rank the support departments based on the percentage of their services provided to other support departments. Use this ranking to allocate the support departments’ costs to the operating departments based on the step-down method.
![Direct and step-down allocation. E-books, an online book retailer, has two operating departments-
corporate sales and consumer sales-and two support departments-human resources and information
systems. Each sales department conducts merchandising and marketing operations independently. E-books
uses number of employees to allocate human resources costs and processing time to allocate information
systems costs. The following data are available for September 2017:
Page Layout
Data
Home
Insert
Formulas
Review
View
в
SUPPORT
ID
OPERATING
DEPARTMENTS
DEPARTMENTS
Corporate Consumer
Sales
Sales
Human
Information
Resources Systems
3 Budgeted costs incurred before any
interdepartment cost allocations
Support work supplied by human
5 resources department
Budgeted number of employees
Support work supplied by information
7 systems department
Budgeted processing time (in minutes)
$72,700
$234,400
$998,270 $489,860
4
21
42
28
8.
320
1,920
1,600](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdf6c3b07-a233-4ae2-bb19-1e99ae47a334%2Fc783c476-f821-44d5-b98f-27504e225472%2F08iu545.jpeg&w=3840&q=75)
Transcribed Image Text:Direct and step-down allocation. E-books, an online book retailer, has two operating departments-
corporate sales and consumer sales-and two support departments-human resources and information
systems. Each sales department conducts merchandising and marketing operations independently. E-books
uses number of employees to allocate human resources costs and processing time to allocate information
systems costs. The following data are available for September 2017:
Page Layout
Data
Home
Insert
Formulas
Review
View
в
SUPPORT
ID
OPERATING
DEPARTMENTS
DEPARTMENTS
Corporate Consumer
Sales
Sales
Human
Information
Resources Systems
3 Budgeted costs incurred before any
interdepartment cost allocations
Support work supplied by human
5 resources department
Budgeted number of employees
Support work supplied by information
7 systems department
Budgeted processing time (in minutes)
$72,700
$234,400
$998,270 $489,860
4
21
42
28
8.
320
1,920
1,600
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