Happy Burger Co. has a commissary that supplies food and other products to its restaurants. It has two service departments, computer services (S1) and administration and maintenance (S2), which support two operating departments, food products (PI) and supplies (P2). As internal auditor, you are checking the procedures for cost allocation and find the following results: Costs allocated to Pl: P 30,000 from S1 ? from S2 Costs allocated to P2: P 15,000 from S2 ? from S1 Total costs for the two service departments P 80,000 S2's services are provided as follows: 20% to S1 50% to PI 30% to P2 28. Using direct method of allocating service department costs, compute the total service department costs incurred by S2. а. Zero b. P 20,625 с. Р 40,000 d. P 50,000

Happy Burger Co. has a commissary that supplies food and other products to its restaurants. It has two service departments, computer services (S1) and administration and maintenance (S2), which support two operating departments, food products (PI) and supplies (P2). As internal auditor, you are checking the procedures for cost allocation and find the following results: Costs allocated to Pl: P 30,000 from S1 ? from S2 Costs allocated to P2: P 15,000 from S2 ? from S1 Total costs for the two service departments P 80,000 S2's services are provided as follows: 20% to S1 50% to PI 30% to P2 28. Using direct method of allocating service department costs, compute the total service department costs incurred by S2. а. Zero b. P 20,625 с. Р 40,000 d. P 50,000

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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