Garcia Company has two service departments,Maintenance and Personnel.Garcia 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: Assume the step-down method is used to allocate service department costs and the Personnel Department is allocated first.Then the amount of cost allocated from the Maintenance Department to the Personnel Department is ________.
A)$0
B)$5,040
C)$6,300
D)$6,825

Question

Garcia Company has two service departments,Maintenance and Personnel.Garcia 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:  Assume the step-down method is used to allocate service department costs and the Personnel Department is allocated first.Then the amount of cost allocated from the Maintenance Department to the Personnel Department is ________.
A)$0 
B)$5,040 
C)$6,300 
D)$6,825

Quizplus · Accepted Answer

The Answer of Garcia Company has two service departments,Maintenance and Personnel.Garcia 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:  Assume the step-down method is used to allocate service department costs and the Personnel Department is allocated first.Then the amount of cost allocated from the Maintenance Department to the Personnel Department is ________.
A)$0 
B)$5,040 
C)$6,300 
D)$6,825

Garcia Company Has Two Service Departments,Maintenance and Personnel