Reference no: EM132522098

Botox Corp. uses the direct method to allocate service department overhead costs to operating departments. Information for the month of June follows:

                                                                                     Service Departments                  Maintenance  Utilities
Departmental costs incurred                                          $ 20,000                        $10,000
Service provided to departments:
Maintenance                10%
Utilities                       20%
Operating - A                                                                    40%                         30%
Operating - B                                                                  40%                              60%

Question 1: What would be the amount of maintenance department costs allocated to Operating Department A for June?

a) $8,000

b) $8,800

c) $10,000

d) $20,000