LO 4-6 Exercise 4-16B Allocating service centers' costs to operating departments-direct method Willis Corporation, a book publisher, has two service departments: editing and typesetting. Willis also has three operating departments: children's fiction, youth fiction, and adult fiction. The annual costs of operating the editing department are $480,000 and the annual costs of operating the typesetting department are $240,000. Willis uses the direct method to allocate service center costs to operating departments. Other relevant data follow. Children Youth Adult Number of Pages Number of Hours 15,000 10,000 5,000 5,000 8,000 7,000 Required a. Allocate the service center costs to the operating departments using the number of pages as the cost driver. b. Allocate the service center costs to the operating departments using the number of hours as the cost driver. Page 198

LO 4-6 Exercise 4-16B Allocating service centers' costs to operating departments-direct method Willis Corporation, a book publisher, has two service departments: editing and typesetting. Willis also has three operating departments: children's fiction, youth fiction, and adult fiction. The annual costs of operating the editing department are $480,000 and the annual costs of operating the typesetting department are $240,000. Willis uses the direct method to allocate service center costs to operating departments. Other relevant data follow. Children Youth Adult Number of Pages Number of Hours 15,000 10,000 5,000 5,000 8,000 7,000 Required a. Allocate the service center costs to the operating departments using the number of pages as the cost driver. b. Allocate the service center costs to the operating departments using the number of hours as the cost driver. Page 198

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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