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University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period: Machine-hours Labor-hours Department direct costs Required: Maintenance Personnel 2,000 900 $3,600 $13,600 Printing 2,000 900 $14, 200 Developing 4,000 2,100 $12,600

University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period: Machine-hours Labor-hours Department direct costs Required: Maintenance Personnel 2,000 900 $3,600 $13,600 Printing 2,000 900 $14, 200 Developing 4,000 2,100 $12,600

FINANCIAL ACCOUNTING
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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Exercise 11-31 (Algo) Cost Allocation: Step Method (LO 11-3) University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period: Personnel Printing 2,000 2,000 900 $14,200 Machine-hours Labor-hours Department direct costs Maintenance Service department costs Maintenance Personnel Total costs allocated 900 $ 3,600 Required: Allocate the service department costs using the step method, starting with the Maintenance Department. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.) $ $13,600 Maintenance Personnel 0 $ Printing Developing 0 $ Developing 4,000 2,100 $12,600 0 $ 0
Transcribed Image Text:Exercise 11-31 (Algo) Cost Allocation: Step Method (LO 11-3) University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period: Personnel Printing 2,000 2,000 900 $14,200 Machine-hours Labor-hours Department direct costs Maintenance Service department costs Maintenance Personnel Total costs allocated 900 $ 3,600 Required: Allocate the service department costs using the step method, starting with the Maintenance Department. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.) $ $13,600 Maintenance Personnel 0 $ Printing Developing 0 $ Developing 4,000 2,100 $12,600 0 $ 0
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