Dept. costs - service1-$63,000, service2- $42,000, Production1- $200,000, produc

Question

Dept. costs - service1-$63,000, service2- $42,000, Production1- $200,000, production2 -$100,000
# of transactions - service1- 10,000, service2- 12,000, production1 - 14,000, production2- 16,000
Square feet occupied- service1- 2000, service2- 1000, production1- 3000, production2- 2,000

Assuming the company allocated service dept. costs by the direct method, how much overhead would
be allocated from each service dept to each producing dept

1. service1- production1 %? service1 - production2 %?
2. service2 - production1 %? service2- production2 %?

Explanation / Answer

2. service2 - production1 %? service2- production2 %

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