Find total cost of each production department

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Reference no: EM132760993

Problem - Davis Snowflake & Co. produces Christmas stockings in its Cutting and Sewing departments. The Maintenance and Security departments support the production of the stockings. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table:


Maintenance Department

Security Department

Cutting Department

Sewing Department

Machine hours

800

2,000

7,200

10,800

Asset value

$2,000

$1,670

$2,500

$5,500

Department cost

$36,000

$16,000

$64,000

$82,000

Required - Find total cost of each production department after allocating all support department costs to the production departments using the reciprocal services method.

Reference no: EM132760993

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