Slewah Corporation has two main production departments, Cameras and Batteries. The company also has two service departments,
Question:
Slewah Corporation has two main production departments, Cameras and Batteries. The company also has two service departments, the Human Resources department and the Information Technology department. The budgeted costs in the two service departments, Human Resources and Information Technology, are £550,000 and £350,000 respectively. Slewah Corporation allocates the costs of the Human Resources department first when using the step-down method. The usage of these two service departments’ output for the year is as follows:
Provider of Service | ||
User of Service | Human Resources | Information Technology |
Human Resources | __ | 50% |
Information Technology | 20% | __ |
Cameras | 40% | 30% |
Batteries | 40% | 20% |
If Slewah Corporation uses the direct method to allocate the budgeted costs of the Information Technology department, what would be the budgeted cost allocated to the Cameras department?
Fundamental Managerial Accounting Concepts
ISBN: 978-0078025655
7th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Old