rish Corporation distributes its service department overhead cost directly tto producing departments. Information for January, 2030 is presented below. Maintenance Utilities FOH cost 93,500 45,000 Service Provided to Maintenance 10% Utilities 20% Mixing 40% 30% Assembly 40% 60% Required: Determined the amount of factory overhead cost of service departments allocated to producing departments using: Direct Method Step Method Reciprocal Method

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Problem 18  Service Cost Allocation

Irish Corporation distributes its service department overhead cost directly tto producing departments. Information for January, 2030 is presented below.

                                                   Maintenance           Utilities

FOH cost                                      93,500                    45,000

Service Provided to

Maintenance                                                                  10%

Utilities                                            20%           

Mixing                                             40%                         30%

Assembly                                         40%                         60%


Required: Determined the amount of factory overhead cost of service departments allocated to producing departments using:

  1. Direct Method
  2. Step Method
  3. Reciprocal Method
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