Question

Question 29 3 points Save Answer Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center Warehouse Department costs of $370,000 are located on the basis of budgeted warehouse-hours. Data Center Department costs of $200,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $142,500 and $171,000, respectively. Data on budgeted warehouse hours and number of computer log-on hours are as follows: Production Departments Music Books Support Departments Warehouse Data Center Department Department $370,000 $200,000 NA 590 Budgeted costs $142,500 15171,000 1000 1600 Budgeted warehouse-hours Number of computer hours 250 NA 8601010 Using the step down method, what amount of Data Center Department cost will be allocated to Department Music of the service department with the highest percentage of interdepartmental support service is allocated first? (Round intermediary calculations to three decimal places) A 591.979 B. $144.992 C. $108.021 D. $123 487

Answer 1

D.123487

Allocation	Warehouse Department	Data Center Department	Music	Books
warehouse (590/(590+1000+1600)		0.185	0.313	0.502
Data (250/(250+860+1010))	0.118		0.406	0.476
	Warehouse Department	Data Center Department	Music	Books
Budgeted costs	$                                370,000	$                                200,000	$          142,500	$          171,000
Allocation of 370000	$                              (370,000)	$                                   68,433	$          115,987	$          185,580
	$                                            -	$                                268,433	$          258,487	$          356,580
Allocation of 268433(268433*860/(860+1010))			$          123,450	$          144,982