Reciprocal method for period cost allocations

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Reference no: EM134044746

Question

Summerland Orchards has two operating departments, retail and wholesale, and two support departments, Accounting and Human Resources. The base used to allocate accounting is budgeted salaries. The base used to allocate human resources is budgeted hours. The Accounting budget is $466,000, while the Human Resources budget is $180,000. The following chart summarizes the allocation-base amounts used by each department annually: Operating Departments Supporting Departments Retail Wholesale Accounting Human Resources Accounting (salaries) $9,000 $11,000 n/a $4,000 Human Resources (hours) 10,000 9,000 4,000 n/a What is the total cost allocated to the Wholesale Department under the reciprocal method for period cost allocations?

Reference no: EM134044746

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