Chapter 11, Problem 29E

Cost Allwat ion: Direct Method

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:

Required

Use the direct method to allocate these service department costs to the operating departments.