5 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 operatingdepartments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each ITrequest) 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 ticketsEmployeesDepartment direct costs.Required:ITHR1,10019еPublishing1,10027Binding3,30043$ 153,000$ 247,500$ 430,000$ 390,000Use 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.Service department costsIT allocationITHRPublishingBindingHR allocationTotal costs allocated$0 $0 S0.00 $0.00

Lets understand the basics.The service department costs are allocated to operating departments using…

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 HR IT tickets Employees 1,100 19 Publishing 1,100 27 Binding 3,300 43 Department direct costs $ 153,000 $247,500 $430,000 $ 390,000