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Question - City Company has two service departments, Maintenance and Personnel, as well as two production departments, Mixing and Finishing. Maintenance costs are allocated based on square footage while personnel costs are allocated based on number of employees. The following information has been gathered for the current year:
Maintenance
Personnel
Mixing
Finishing
Direct dept. costs
$18,000
$12,000
$15,000
$25,000
Sq. footage
800
400
1,600
1,200
No. of employees
8
12
24
32
If the step - down method is used to allocate costs, and the Maintenance Department renders the greatest service, the total number of overhead that would be allocated from Personnel to Mixing is:
A. $5,143
B. $6,107
C. $9,000
D. $6,000
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