Question

Madison Company has two service departments (personnel and accounting) and two production departments (computer and video)....

Madison Company has two service departments (personnel and accounting) and two production departments (computer and video). The computer department uses 40% of the accounting department services, the video department uses 50% and the personnel department uses 10%. If the accounting department incurs $50,000 of costs, under the step-down method the final allocation would be:

Select one:

a. Personnel $5,000; Video $25,000; and Computer $20,000

b. None of the alternatives are correct

c. Video $27,778; and Computer $22,222

d. Personnel $10,000; Video $50,000; and Computer $40,000

e. Video $25,000; and Computer $25,000

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Answer

  • Allocation:
    >Computer department = $ 50000 x 40% = $ 20000
    >Video Department = $ 50000 x 50% = $ 25000
    >Personnel department = $ 50000 x 10% = $ 5000
  • Correct Answer = Option ‘a’
    Personnel $5,000; Video $25,000; and Computer $20,000
Add a comment
Know the answer?
Add Answer to:
Madison Company has two service departments (personnel and accounting) and two production departments (computer and video)....
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments.  All allocations are based on total employees. Computer Operations has costs of $125,000 and Maintenance Services has costs of $130,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Mixing...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Computer Operations has costs of $155,000 and Maintenance Services has costs of $180,000 before any allocations. What amount of Maintenance Services total cost is allocated to the...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments.  All allocations are based on total employees. Computer Operations has costs of $120,000 and Maintenance Services has costs of $110,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Mixing...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Computer Operations has costs of $185,000 and Maintenance Services has costs of $170,000 before any allocations. What amount of Maintenance Services total cost is allocated to the...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $190,000 and Maintenance Services has costs of $145,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are:             Computer...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $195,000 and Maintenance Services has costs of $150,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are:             Computer...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $105,000 and Maintenance Services has costs of $160,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are: Computer...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $160,000 and Maintenance Services has costs of $180,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are:             Computer...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $115,000 and Maintenance Services has costs of $175,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are:             Computer...

  • Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments...

    Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $175,000 and Maintenance Services has costs of $195,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are: Computer...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT