Budgeted fixed costs in Swasey company\'s Maintenance Department were $180,000;

Question

Budgeted fixed costs in Swasey company's Maintenance Department were $180,000; actual fixed costs in the department for the year were $186,000. The level of budgeted fixed costs in the Maintenance Department depends on peak-period requirements. The Milling Department requires one-third of the peak-period capacity and the Assembly Department requires two-thirds of peak-period capacity.

How much fixed Maintenance Department cost should be charged to the Milling Department at year-end?

$93,000

$60,000

$62,000

$46,500

$93,000

$60,000

$62,000

$46,500

Explanation / Answer

Fixed Maintenance Department cost to be charged to the Milling Department = $ 186000*1/3 = $ 62000

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