Krum Lawn Equipment has five departments, of which Casting and Finishing are producing departments. Maintenance, Product Movement, and Inspection are service departments. The distribution of the service departments is as follows:

Service Departments & Their Total Costs						Percent of Services Provided To
Maintenance		Product Movement		Inspection				Casting		Finishing
Maintenance	$84,000		0%		5%		25%		50%		20%
Product Movement	$160,000		0%		10%		5%		45%		40%
Inspection	$38,000		0%		15%		5%		20%		60%

Required:

Use the direct method to allocate the service departments’ costs. Prepare a schedule showing the total costs allocated to each department.

Answer rating: 100% (QA)

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