GG Merchandise has two producing and two service departments labeled P1, P2, S1 and S2, respectively. Direct costs for each department and the proportion of service costs used by the various departments are as follows: (P1, P300,000); (P2, P200,000); (S1, P100,000; S2-25%, P1-50%, P2-25%); (S2, P40,000; S1-10%, P1-50%, P2-40%). What is the total cost of P1 if the costs of service departments are allocated using the direct method?
GG Merchandise has two producing and two service departments labeled P1, P2, S1 and S2, respectively. Direct costs for each department and the proportion of service costs used by the various departments are as follows: (P1, P300,000); (P2, P200,000); (S1, P100,000; S2-25%, P1-50%, P2-25%); (S2, P40,000; S1-10%, P1-50%, P2-40%). What is the total cost of P1 if the costs of service departments are allocated using the direct method?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:GG Merchandise has two producing and two service departments labeled
P1, P2, S1 and S2, respectively. Direct costs for each department and the
proportion of service costs used by the various departments are as
follows: (P1, P300,000); (P2, P200,000); (S1, P100,000; S2-25%, P1-50%,
P2-25%); (S2, P40,000; S1-10%, P1-50%, P2-40%). What is the total cost
of P1 if the costs of service departments are allocated using the direct
method?
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