Using the sequential method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has determined to allocate Janitorial costs before Cafeteria costs. It has the following information about its two service departments and two production departments, Cutting and Assembly: Line Item Description Costs Square Feet Number ofEmployees Janitorial Department $450,000 100 20 Cafeteria Department 200,000 10,000 10 Cutting Department 1,500,000 2,000 60 Assembly Department 3,000,000 8,000 20 How much of the Janitorial Department’s $450,000 costs is allocated to the Cutting Department? a. $45,000 b. $44,550 c. $360,000 d. $90,000
Using the sequential method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has determined to allocate Janitorial costs before Cafeteria costs. It has the following information about its two service departments and two production departments, Cutting and Assembly: Line Item Description Costs Square Feet Number ofEmployees Janitorial Department $450,000 100 20 Cafeteria Department 200,000 10,000 10 Cutting Department 1,500,000 2,000 60 Assembly Department 3,000,000 8,000 20 How much of the Janitorial Department’s $450,000 costs is allocated to the Cutting Department? a. $45,000 b. $44,550 c. $360,000 d. $90,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Using the sequential method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has determined to allocate Janitorial costs before Cafeteria costs.
It has the following information about its two service departments and two production departments, Cutting and Assembly:
| Line Item Description | Costs | Square Feet | Number of Employees |
|---|---|---|---|
| Janitorial Department | $450,000 | 100 | 20 |
| Cafeteria Department | 200,000 | 10,000 | 10 |
| Cutting Department | 1,500,000 | 2,000 | 60 |
| Assembly Department | 3,000,000 | 8,000 | 20 |
How much of the Janitorial Department’s $450,000 costs is allocated to the Cutting Department?
a. $45,000
b. $44,550
c. $360,000
d. $90,000
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