Calculate the total amount of service department cost

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Question - The Dexter Manufacturing Company has two production departments (Assembly and Finishing) and two service departments (Human Resources and Janitorial). The projected usage of the two service departments is as follows:


Use of Human Resources

Use of Janitorial

Human Resources

---

5%

Janitorial

15%

---

Assembly

50%

45%

Finishing

35%

50%

The budgeted costs in the service departments are: Human Resources, $90,000 and Janitorial, $50,000.

i) Using the direct method, calculate the amount of Janitorial Department cost allocated to the Finishing Department.

ii) Using the step-down method and assuming the Janitorial Department is allocated first, calculate the total amount of service department cost allocated to the Assembly Department and the Finishing Department respectively.

Reference no: EM132004587

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