Question

Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below:


The company allocates service department costs by the step-down method in the following order:
Administrative (number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours).

Required:
Using the step-down method, allocate the service department costs to the operatingdepartments.


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  • CreatedSeptember 27, 2013
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