A company operates with two processing departments:

1. Cutting department
2. Assembly department.

• The human resources and maintenance departments support the processing departments.
• Budgeted costs for the support departments for the period are as follows:

Human resources Maintenance

Salaries and wages $ 105,000 $ 14,000

Direct costs 15,000 24,000

Depreciation 30,000 32,000

Total $ 150,000 $ 70,000

• Costs are allocated to the processing departments based on the following activity levels:

Supplied by Human resources Maintenance Cutting Assembly

Human resources (employees) 15 25 175 200

Maintenance (square metres) 2,000 3,000 10,000 40,000

• Using the step-down method,beginning with human resources, how much of the total support department costs should be allocated to assembly?

2. Stomp-rite Inc. makes hiking boots. The company operates with two processing departments: the cutting department and the assembly department. The human resources and maintenance departments support the processing departments. Budgeted costs for the support departments for the period are as follows: Human resources Maintenance Salaries and wages $ 105,000 $ 14,000 Direct costs 15,000 24,000 Depreciation 30.000 32,000 Total $ 150.000 $ 70,000 Costs are allocated to the processing departments based on the following activity levels: Human Supplied by resources Maintenance Cutting Assembly Human resources (employees) 15 25 175 200 Maintenance (square metres) 2,000 3,000 10,000 40.000 Using the step-down method, beginning with human resources, how much of the total support department costs should be allocated to assembly