Madison Park Co-op, a whole foods grocery and gift shop, has provided the follow

Question

Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department cost allocations:

Operating Departments Groceries Service Departments AdministrationJanitorial $ 50,000 340 1,100 Gifts Departmental costs before allocations Employee-hours Space occupied-square feet S 200,000 490 1,000 $3,850,000 $ 330,000 180 900 2,680 9,100 Required Using the step-down method, allocate the costs of the service departments to the two operating departments. Allocate Administration first on the basis of employee-hours and then Janitorial on the basis of space occupied. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations. Round your answers to the nearest dollar amount.) Service Departments Operating Departments Groceries Administration Janitorial Gifts Total 330,000 S 4,430,000 Departmental costs before allocations Allocation S 200,000 S 50,000$3.850,000 S Administration costs Janitorial costs Total costs after allocation 200,000 S 50,000$3.850,000 S 330,000 4,430,000

Explanation / Answer

Allocation using the step-down method:

Service Departments Operating Departments Total Administration Janitorial Grocesies Gifts Departmental costs before allocations $200000 $50000 $3850000 $330000 $4430000 Allocation: Administration costs (200000) 21590 170180 11430 0 Janitorial costs 0 (71590) 65147 6443 0 Total costs after allocation 0 0 4,085,327 347,873 4,430,000

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.