Support-department cost allocation; direct and step-down methods. Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two sup- port departments-administrative services (AS) and information systems (IS)-and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Phoenix's cost records indicate the following: Home Insert Page Layout Formulas Data Review View в SUPPORT AS OPERATING IS GOVT CORP Total 3 Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS 5 (budgeted head count) Support work supplied by IS 6 (budgeted computer time) $600,000 $2,400,000 $8,756,000 $12,452,000 $24,208,000 25% 40% 35% 100% 10% 30% 60% 100%
Support-department cost allocation; direct and step-down methods. Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two sup- port departments-administrative services (AS) and information systems (IS)-and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Phoenix's cost records indicate the following: Home Insert Page Layout Formulas Data Review View в SUPPORT AS OPERATING IS GOVT CORP Total 3 Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS 5 (budgeted head count) Support work supplied by IS 6 (budgeted computer time) $600,000 $2,400,000 $8,756,000 $12,452,000 $24,208,000 25% 40% 35% 100% 10% 30% 60% 100%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Allocate the two support departments’ costs to the two operating departments using the Direct method
![Support-department cost allocation; direct and step-down methods. Phoenix Partners
provides management consulting services to government and corporate clients. Phoenix has two sup-
port departments-administrative services (AS) and information systems (IS)-and two operating
departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of
2017, Phoenix's cost records indicate the following:
Home
Insert
Page Layout
Formulas
Data
Review
View
в
SUPPORT
AS
OPERATING
IS
GOVT
CORP
Total
3 Budgeted overhead costs before any
interdepartment cost allocations
Support work supplied by AS
5 (budgeted head count)
Support work supplied by IS
6 (budgeted computer time)
$600,000 $2,400,000
$8,756,000 $12,452,000 $24,208,000
25%
40%
35%
100%
10%
30%
60%
100%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdf6c3b07-a233-4ae2-bb19-1e99ae47a334%2Ff956563e-ec60-43bb-923d-7dc8414543da%2Ft554b2.jpeg&w=3840&q=75)
Transcribed Image Text:Support-department cost allocation; direct and step-down methods. Phoenix Partners
provides management consulting services to government and corporate clients. Phoenix has two sup-
port departments-administrative services (AS) and information systems (IS)-and two operating
departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of
2017, Phoenix's cost records indicate the following:
Home
Insert
Page Layout
Formulas
Data
Review
View
в
SUPPORT
AS
OPERATING
IS
GOVT
CORP
Total
3 Budgeted overhead costs before any
interdepartment cost allocations
Support work supplied by AS
5 (budgeted head count)
Support work supplied by IS
6 (budgeted computer time)
$600,000 $2,400,000
$8,756,000 $12,452,000 $24,208,000
25%
40%
35%
100%
10%
30%
60%
100%
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