Question

Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments.  All allocations are based on total employees. Computer Operations has costs of $125,000 and Maintenance Services has costs of $185,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Mixing Department? (round to closest whole dollar) Employees are:

            Computer Operations 4

            Maintenance Services 3

Mixing Department 6

Packaging Department 5

Your Answer:

Question 9 options:

Answer

Answer 1

Maintenance Services total cost is allocated to the Mixing Department = $115519

Allocation Working:
Particulars	Computer operations	Maintenance services	Mixing department	Packaging department	Total Employees
Departmental cost	125000	185000
No. of Employees		3	6	5	14
Allocation of computer operation	-125000	26786	53571	44643
No. of Employees			6	5	11
Allocation of maintenance cost		-211786	115519	96266
Total Cost	0	0	169091	140909