Question

A firm has two service departments (A and B) and two production departments (X and Y)....

A firm has two service departments (A and B) and two production departments (X and Y). The firm allocates service department cost using the direct method.

Service Department A's services are consumed as follows.

  • 20% used by Service Department B.
  • 20% used by Production Department X.
  • 60% used by Production Department Y.

Service Department A has $724,586 costs for the period and Production Department Y has $1,097,024 costs for the period.

What is Department Y's total cost after service department costs have been allocated (round final answer to nearest cent if necessary)?

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Answer #1

Department Y's total cost after service department costs are allocated = $1,097,024+ $543,440 = $ 1,640,464

for any claification please comment.

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