Theresa Company has two service departments,Maintenance and Personnel.Theresa Company also has two production departments,Mixing and Finishing.Maintenance costs are allocated based on square footage while personnel costs are allocated based on number of employees.The following information has been gathered for the current year: If the direct method is used to allocate service department costs,then the total cost of the Mixing Department after allocation would be ________.
A)$36,000
B)$72,000
C)$105,000
D)$213,000

Question

Theresa Company has two service departments,Maintenance and Personnel.Theresa Company also has two production departments,Mixing and Finishing.Maintenance costs are allocated based on square footage while personnel costs are allocated based on number of employees.The following information has been gathered for the current year:  If the direct method is used to allocate service department costs,then the total cost of the Mixing Department after allocation would be ________.
A)$36,000 
B)$72,000 
C)$105,000 
D)$213,000

Quizplus · Accepted Answer

The Answer of Theresa Company has two service departments,Maintenance and Personnel.Theresa Company also has two production departments,Mixing and Finishing.Maintenance costs are allocated based on square footage while personnel costs are allocated based on number of employees.The following information has been gathered for the current year:  If the direct method is used to allocate service department costs,then the total cost of the Mixing Department after allocation would be ________.
A)$36,000 
B)$72,000 
C)$105,000 
D)$213,000

Theresa Company Has Two Service Departments,Maintenance and Personnel