Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations: Departmental costs before allocations Allocations: Service Departments Administration Janitorial $ 200,000 $ 70,000 330 1,200 Departmental costs before allocations Employee-hours Space occupied-square feet Required: Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Administration costs Janitorial costs Total costs after allocations Service Departments Administration Janitorial $ 200,000 $ Operating Departments Groceries Gifts $ 3,840,000 2,710 9,200 470 700 Operating Departments Groceries Gifts 70,000 $ 3,840,000 $ Total $ 340,000 160 800 340,000 $ 4,450,000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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E 1

Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost
allocations:
Departmental costs before allocations
Allocations:
Service Departments
Janitorial
$ 70,000
330
1,200
Administration costs
Janitorial costs
Total costs after allocations
Administration
$ 200,000
470
700
Departmental costs before allocations
Employee-hours
Space occupied-square feet
Required:
Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration
first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department
as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate
calculations. Round your answers to the nearest whole dollar amount.)
Service Departments
Administration Janitorial
Operating Departments
Groceries
Gifts
$ 340,000
$ 3,840,000
2,710
9,200
160
800
Operating Departments
Groceries
Gifts
$ 200,000 $ 70,000 $3,840,000 $
Total
340,000 $4,450,000
Transcribed Image Text:Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations: Departmental costs before allocations Allocations: Service Departments Janitorial $ 70,000 330 1,200 Administration costs Janitorial costs Total costs after allocations Administration $ 200,000 470 700 Departmental costs before allocations Employee-hours Space occupied-square feet Required: Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Service Departments Administration Janitorial Operating Departments Groceries Gifts $ 340,000 $ 3,840,000 2,710 9,200 160 800 Operating Departments Groceries Gifts $ 200,000 $ 70,000 $3,840,000 $ Total 340,000 $4,450,000
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