Figure 7-6 Golden Leaves Company has two support departments, Maintenance Department (MD) and Personnel Department (PD) , and two producing departments, P1 and P2. The Maintenance Department costs of $30,000 are allocated on the basis of standard service used. The Personnel Department costs of $4,500 are allocated on the basis of number of employees. The direct costs of Departments P1 and P2 are $9,000 and $15,000, respectively.
Data on standard service hours and number of employees are as follows:
Refer to Figure 7-6. Using the direct method, the cost of the Maintenance Department allocated to Department P1 is
A) $15,000.
B) $10,000.
C) $20,000.
D) $30,000.
Correct Answer:
Verified
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