Assume that X Company has three service departments A,B,C and two producing departments X and Y....

 

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Assume that X Company has three service departments A,B,C and two producing departments X and Y. Percentage of Service Total Costs A B P100,000 P200,000 B 25% -- P300,000 C- A REQUIRED: 1. Determine the service department costs allocated to each producing departments under the following methods: B 00 a. Direct Method b. Reciprocal Method XY XY C Total A 00 B C Total A c. Step-down Method XY B C V 20% 10% 30% 40% 10% 18% 47% 20% 80% -- Total C X Y 2. Assuming that the factory overhead costs of X and Y before allocation were P100,000 and P200,000 respectively, determine the total costs of X a under each method. a. Direct Method b. Reciprocal Method c. Step-down Method X Assume that X Company has three service departments A,B,C and two producing departments X and Y. Percentage of Service Total Costs A B P100,000 P200,000 B 25% -- P300,000 C- A REQUIRED: 1. Determine the service department costs allocated to each producing departments under the following methods: B 00 a. Direct Method b. Reciprocal Method XY XY C Total A 00 B C Total A c. Step-down Method XY B C V 20% 10% 30% 40% 10% 18% 47% 20% 80% -- Total C X Y 2. Assuming that the factory overhead costs of X and Y before allocation were P100,000 and P200,000 respectively, determine the total costs of X a under each method. a. Direct Method b. Reciprocal Method c. Step-down Method X

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Answer a Direct Method X Y A P 85714 P 114286 B 33333 66667 C 60000 240000 Total 179047 420953 Explanation Under the direct method the costs of service departments are allocated directly to the produc... View the full answer