Prepare a schedule allocating the support department costs

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Sugar Company has two support departments (S1 and S2) and two producing departments (P1 and P2). Estimated direct costs and percentages of services used by these departments are as follows:

Used by Department
Support Dept. S1 S2 P1 P2

S1 - 10% 40% 50%

S2 20%-50%30% Direct costs $4,500 $8,000 $10,000 $15,000

Required:

  1. Prepare a schedule allocating the support department costs to the producing departments using the direct allocation method.

  2. Prepare a schedule allocating the support department costs to the producing departments using the sequential allocation method.

Reference no: EM13575770

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