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StPaul Medical Clinic Has Two Service Departments: Building Operations and Utilities,and

Question 172

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St.Paul Medical Clinic has two service departments: Building Operations and Utilities,and three operating departments: Rehabilitation,Preventative Medicine,and Geriatrics.St.Paul Medical Clinic allocates the cost of Building Operations on the basis of square footage and Utilities on the basis of patient days.Fixed and variable costs are not separated.
Budgeted operating data for the previous year are presented below:

  Service Building Operations    Departments Utilities  Operating Rehabilitation Departments Preventative Medicine   Geriatrics 
Budgeted costs before allocation    $20,000   $10,000   $90,000   $60,000   $100,000
 Square Footage  1,000  4,000  6,000  18,000  12,000
 Patient Days  -  -  5,500  7,700  8,800

Required:
a. Prepare a schedule to allocate service department costs to operating departments by the chrect method (round all dollar amounts to the ne arest whole dollar).

b. Prepare a schechule to allocate service department costs to operating departments by the step method, allocating Building Operations first (round all amounts to the nearest whole dollar).

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