Please help me with this question (4) Barstow Manufacturing Company has two serv

Question

Please help me with this question (4)

Barstow Manufacturing Company has two service departments - product design and engineering support, and two production departments - assembly and finishing. The distribution of each service department's efforts to the other departments is shown below: The direct operating costs of the departments (including both variable and fixed costs) were as follows: The total cost accumulated in the assembly department using the step method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar; assume that the design department goes first):

Explanation / Answer

So, total cost allocated to Assembly department = $ 132,551 + $ 550,000 = $ 682,551. So, the nearest answer is $ 689,875 that is option D.

COST ALLOCATION TO DEPARTMENTS Department Allocation Ratio Total Cost Design Support Assembly Finishing Design 1:03:06 140000 0 14000 42000 84000 Engineering Support 20:45:35 160000 32000 0 72000 56000 32000 14000 114000 140000 Design 1:03:06 32000 -32000 3200 9600 19200 0 17200 123600 159200 Engineering Support 20:45:35 17200 3440 -17200 7740 6020 3440 0 131340 165220 Design 1:03:06 3440 -3440 344 1032 2064 0 344 132372 167284 Engineering Support 20:45:35 344 68.8 -344 154.8 120.4 68.8 0 132526.8 167404.4 Design 1:03:06 68.8 -68.8 6.88 20.64 41.28 0 6.88 132547.4 167445.7 Engineering Support 20:45:35 6.88 1.376 -6.88 3.096 2.408 1.376 0 132550.5 167448.1

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