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 1,000 Maintenance Machine-hours Labor-hours Department direct costs Printing 1,000 500 $15,000 Developing 3,000 2,000 $10,000 500 $5,000 $12,000 Required: Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.)
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 1,000 Maintenance Machine-hours Labor-hours Department direct costs Printing 1,000 500 $15,000 Developing 3,000 2,000 $10,000 500 $5,000 $12,000 Required: Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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:
Developing
3,000
2,000
$10,000
Maintenance
Personnel
Machine-hours
Labor-hours
Printing
1,000
500
1,000
500
Department direct costs
$5,000
$12,000
$15,000
Required:
Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be
indicated by a minus sign. Do not round intermediate calculations.)
Maintenance
Personnel
Printing
Developing
Service department costs
Maintenance allocation
Personnel allocation
Total costs allocated](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fef18cb14-9a47-40a9-9006-9c9e041022ca%2Ff91dd899-2ce8-423d-8cd4-8c5364a0b6db%2Fai6z31k_processed.png&w=3840&q=75)
Transcribed Image Text: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:
Developing
3,000
2,000
$10,000
Maintenance
Personnel
Machine-hours
Labor-hours
Printing
1,000
500
1,000
500
Department direct costs
$5,000
$12,000
$15,000
Required:
Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be
indicated by a minus sign. Do not round intermediate calculations.)
Maintenance
Personnel
Printing
Developing
Service department costs
Maintenance allocation
Personnel allocation
Total costs allocated
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