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Exercise 11-27 (Algo) Cost Allocation: Direct Method (LO 11-1) Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments Publishing and Binding Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department The following data appear in the company records for the current period IT tickets Employees Department direct costs IT 0 30 $ 154,000 HR 2,000 D $ 247,500 Publishing 2,000 $430,000 Binding 3,000 54 $390,000 Required: Use the direct method to allocate these service department costs to the operating departments Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round "Publishin-

Exercise 11-27 (Algo) Cost Allocation: Direct Method (LO 11-1) Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments Publishing and Binding Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department The following data appear in the company records for the current period IT tickets Employees Department direct costs IT 0 30 $ 154,000 HR 2,000 D $ 247,500 Publishing 2,000 $430,000 Binding 3,000 54 $390,000 Required: Use the direct method to allocate these service department costs to the operating departments Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round "Publishin-

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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Exercise 11-27 (Algo) Cost Allocation: Direct Method (LO 11-1) Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department The following data appear in the company records for the current period IT tickets Employees Department direct costs Service department costs IT allocation HR allocation Total costs allocated IT IT 3 30 $ 154,000 HR HR 2,000 D $ 247,500 Publishing 2,000 136 $430,000 Required: Use the direct method to allocate these service department costs to the operating departments Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round "Publishing" and "Binding" answers to 2 decimal places. Binding Publishing 3,000 54 $ 390,000 Binding
Transcribed Image Text:Exercise 11-27 (Algo) Cost Allocation: Direct Method (LO 11-1) Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department The following data appear in the company records for the current period IT tickets Employees Department direct costs Service department costs IT allocation HR allocation Total costs allocated IT IT 3 30 $ 154,000 HR HR 2,000 D $ 247,500 Publishing 2,000 136 $430,000 Required: Use the direct method to allocate these service department costs to the operating departments Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round "Publishing" and "Binding" answers to 2 decimal places. Binding Publishing 3,000 54 $ 390,000 Binding
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