Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows: Provider of Service HR Computing User of Service HR ................................................................................ — 15% Computing ...................................................................10% — Deposit ...........................................................................60% 50% Loan .................................................................................30% 35% The budgeted costs in the two service departments for the year are as follows: HR ..............................................................................................................................$153,000 Computing ................................................................................................................229,500 Required: Use the direct method to allocate the budgeted costs of the HR and Computing depart-ments to the Deposit and Loan departments. Required: Use the step-down method to allocate the budgeted costs of the HR and Computing depart-ments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first
Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows:
Provider of Service HR Computing
User of Service
HR ................................................................................ — 15%
Computing ...................................................................10% —
Deposit ...........................................................................60% 50%
Loan .................................................................................30% 35%
The budgeted costs in the two service departments for the year are as follows:
HR ..............................................................................................................................$153,000
Computing ................................................................................................................229,500
Required: Use the direct method to allocate the budgeted costs of the HR and Computing depart-ments to the Deposit and Loan departments.
Required: Use the step-down method to allocate the budgeted costs of the HR and Computing depart-ments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
