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What is the amount of service department cost allocated

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Question - The following information is departmental cost allocation with two service departments and two production departments.

Department             Cost             S1            S2          P1         P2

Service 1 (S1)   $35,000             0%          40%       45%      15%

Service 2 (S2)  $25,000             20%       0%         20%      60%

Production 1 (P1) $150,000

Production 2 (P2) $200,000

1. What is the amount of service department cost allocated to P1 and P2 using the step method with S1 going first?

2. What is the amount of service department cost allocated to P1 and P2 using the direct method if the cost in P1 is changed from $150,000 to $170,000.

Reference no: EM131727356

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