step method

Project Description:

warren ltd. has two production departments, building a and building b, and two service departments, maintenance and cafeteria. direct costs for each department and the proportion of service costs used by the various departments for the month of june follow:

proportion of services used by

department direct costs maintenance cafeteria building a building b
building a $ 480,000
building b 331,000
maintenance 194,000 — 0.1 0.7 0.2
cafeteria 158,000 0.7 — 0.2 0.1

a.
use the step method to allocate the service costs, the order of allocation starts with maintenance. (do not round intermediate calculations. round your answers to the nearest dollar amount. leave no cells blank - be certain to enter "0" wherever required. amounts to be deducted should be indicated with a minus sign. omit the "$" sign in your response.)

b.use the step method to allocate the service costs, the allocations are made in the reverse order (starting with cafeteria). (do not round intermediate calculations. round your answers to the nearest dollar amount. leave no cells blank - be certain to enter "0" wherever required. amounts to be deducted should be indicated with a minus sign. omit the "$" sign in your response.)
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