Exerclse $11-33($Algo$)$ Cost Allocation: Dlrect Method $($LO $11-1)$

Memorial Services, Incorporated $($MSI$)$ has three service departments $($IT$,$ Accounting. and HR$)$ and two production departments $($West

and East$).$ The usage data for each of the service departments for the previous period follow:

The direct costs of the service departments in the previous period were $$91,750$ for IT$,$ $$119,000$ for Accounting, and $$162,500$ for HR$.$

Requlred:

Use the direct method to allocate the service department costs to the production departments.

Note: Amounts to be deducted should be Indleated by a minus sign. Do not round Intermedlete calculetlons.