Hessel Corporation has two operating departments (Domestic and Global) and three service departments: Human Resources (HR), Legal,
Question:
Hessel Corporation has two operating departments (Domestic and Global) and three service departments: Human Resources (HR), Legal, and Testing. In the most recent period, the following costs and service department usage ratios were recorded:
Required
Allocate the service department costs to the two operating departments using the reciprocal method.
Transcribed Image Text:
Supplying Department Human Resources.. Legal. Testing. Direct cost Human Resources -0- 10% 10% $264,500 Using Department Legal Testing Domestic Global 15% 10% 25% 50% -0- -0- 30% 60% -0- -0- 45% 45% $190,000 $90,000 $538,000 $487,000
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