Allie, Inc. has two service departments and two operating departments. Allie allocates service department costs using...
Allie, Inc. has two service departments and two operating departments. Allie allocates service department costs using the step-down method, with the service department with the highest cost allocated first. Initial cost for service department 1 was $140,000, and for service department 2, $100,000. Service department 1 is allocated on the basis of department employees, while service department 2 is allocated on the basis of square feet. Cost driver usage is as follows:
Service 1 Service 2 Operating 1 Operating 2
Employees 50 10 20 40
Square Feet 12,000 16,000 22,000 18,000
What are the total service department costs allocated to Operating 2?
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Allie, Inc. has two service departments and two operating
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