York Company has two service departments, Maintenance Department and Personnel Department, and two producing departments, X and Y. The Maintenance Department costs of $120,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $18,000 are allocated on the basis of number of employees. The direct costs of Departments X and Y are $18,000 and $30,000, respectively. Data on standard service-hours and number of employees are as follows:
Using the step method, if Personnel Department costs are allocated first, calculate the cost of Maintenance Department allocation to Department X.

Question

York Company has two service departments, Maintenance Department and Personnel Department, and two producing departments, X and Y. The Maintenance Department costs of $120,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $18,000 are allocated on the basis of number of employees. The direct costs of Departments X and Y are $18,000 and $30,000, respectively. Data on standard service-hours and number of employees are as follows:
  Using the step method, if Personnel Department costs are allocated first, calculate the cost of Maintenance Department allocation to Department X.

Quizplus · Accepted Answer

The Answer of York Company has two service departments, Maintenance Department and Personnel Department, and two producing departments, X and Y. The Maintenance Department costs of $120,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $18,000 are allocated on the basis of number of employees. The direct costs of Departments X and Y are $18,000 and $30,000, respectively. Data on standard service-hours and number of employees are as follows:
  Using the step method, if Personnel Department costs are allocated first, calculate the cost of Maintenance Department allocation to Department X.

York Company Has Two Service Departments, Maintenance Department and Personnel