Using the direct method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has the following information about its two service departments and two production departments, Cutting and Assembly: If the Cafeteria Department incurs costs of $500,000, how much of that cost is allocated to the Assembly Department?
A)$375,000
B)$111,000
C)$125,000
D)$91,000

Question

Using the direct method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has the following information about its two service departments and two production departments, Cutting and Assembly:  If the Cafeteria Department incurs costs of $500,000, how much of that cost is allocated to the Assembly Department?
A)$375,000 
B)$111,000 
C)$125,000 
D)$91,000

Quizplus · Accepted Answer

The Answer of Using the direct method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has the following information about its two service departments and two production departments, Cutting and Assembly:  If the Cafeteria Department incurs costs of $500,000, how much of that cost is allocated to the Assembly Department?
A)$375,000 
B)$111,000 
C)$125,000 
D)$91,000

Using the Direct Method, Pone Hill Company Allocates Janitorial Department