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Exercise 17-18 Step-Down Method of Service Department Cost Allocation; Bank (LO 17-1) Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments' output for the year is as follows: Provider of Service User of Service HR Computing HR 15% Computing Deposit Loan 10% 50% 60% 30% 35% The budgeted costs in the two service departments for the year are as follows: $153,000 229,500 HR Computing Required: Use the step-down method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first. (Do not round intermediate calculations.) Deposit Loan Allocation of HR Department costs Allocation of Computing Department costs Total costs allocated to each department $ 91,800 s 45,900 91,800 S 45,900

Exercise 17-18 Step-Down Method of Service Department Cost Allocation; Bank (LO 17-1) Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments' output for the year is as follows: Provider of Service User of Service HR Computing HR 15% Computing Deposit Loan 10% 50% 60% 30% 35% The budgeted costs in the two service departments for the year are as follows: $153,000 229,500 HR Computing Required: Use the step-down method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first. (Do not round intermediate calculations.) Deposit Loan Allocation of HR Department costs Allocation of Computing Department costs Total costs allocated to each department $ 91,800 s 45,900 91,800 S 45,900

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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Please help find the allocation for Deposit and Loan for HR and Computing.

**Exercise 17-18: Step-Down Method of Service Department Cost Allocation; Bank (LO 17-1)** Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank also has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows: **Table: Provider of Service** - **User of Service:** HR, Computing - **HR:** - HR: 15% - Computing: 10% - Deposit: 60% - Loan: 30% - **Computing:** - HR: – - Computing: – - Deposit: 65% - Loan: 35% The budgeted costs in the two service departments for the year are as follows: - **HR:** $153,000 - **Computing:** $229,500 **Required:** Use the step-down method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first. *(Do not round intermediate calculations.)* **Table: Cost Allocation** - **Allocation of HR Department costs:** - Deposit: $91,800 - Loan: $45,900 - **Allocation of Computing Department costs:** - Deposit: – - Loan: – - **Total costs allocated to each department:** - Deposit: $91,800 - Loan: $45,900
Transcribed Image Text:**Exercise 17-18: Step-Down Method of Service Department Cost Allocation; Bank (LO 17-1)** Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank also has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows: **Table: Provider of Service** - **User of Service:** HR, Computing - **HR:** - HR: 15% - Computing: 10% - Deposit: 60% - Loan: 30% - **Computing:** - HR: – - Computing: – - Deposit: 65% - Loan: 35% The budgeted costs in the two service departments for the year are as follows: - **HR:** $153,000 - **Computing:** $229,500 **Required:** Use the step-down method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first. *(Do not round intermediate calculations.)* **Table: Cost Allocation** - **Allocation of HR Department costs:** - Deposit: $91,800 - Loan: $45,900 - **Allocation of Computing Department costs:** - Deposit: – - Loan: – - **Total costs allocated to each department:** - Deposit: $91,800 - Loan: $45,900
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