Reference no: EM13129383
The building maintenance department for Jones Manufacturing Company budgets annual costs of $4,200,000 based on the expected operating level for the coming year. The costs are allocated to two production departments. The following data relate to the potential allocation bases:
Production Dept. 1
Production Dept. 2
Square footage
15,000
45,000
Direct labor hours
25,000
50,000
If Jones assigns costs to departments based on square footage, how much total costs will be allocated to Production Department 1?
1-$1,400,000
2-$1,050,000
3-$1,575,000
4-$2,100,000
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