Maintenance department and personnel department

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Reference no: EM131202870

Tommy and Baxter company has two service departments, Maintenance Department and Personnel Department, and two producing departments, A and B. The Maintenance Department costs of $240,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $36,000 are allocated on the basis of number of employees. The direct costs of Departments A and B are $36,000 and $60,000, respectively. Data on standard service-hours and number of employees are as follows: Maint. Dept. Person. Dept. Dept. A Dept. B Standard service hours used 200 100 600 300 Number of employees 5 15 25 20 Using the step method, if Personnel Department costs are allocated first, calculate the cost of Maintenance Department allocation to Department A.

Reference no: EM131202870

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