SB Exercise 4B-3 through Exercise 4B-4 (Algo)

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The Ferre Publishing Company provided the following data for its three service departments and two operating departments.

	Service Departments	Operating Departments	Total
Administration	Janitorial	Maintenance	Binding	Printing
Costs	$ 145,600	$ 109,200	$ 49,920	$ 286,000	$ 447,200	$ 1,037,920
Number of employees	60	35	140	315	210	760
Square feet of space occupied	15,000	10,000	20,000	40,000	100,000	185,000
Hours of press time				30,000	60,000	90,000

Exercise 4B-3 (Algo) Step-Down Method [LO4-11]

The company uses the step-down method to allocate service department costs in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time).

Required:

Using the step-down method, allocate the service department costs to the operating departments.

Note: Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.

SB Exercise 4B-3 through Exercise 4B-4 (Algo)

Skip to question

The Ferre Publishing Company provided the following data for its three service departments and two operating departments.

	Service Departments	Operating Departments	Total
Administration	Janitorial	Maintenance	Binding	Printing
Costs	$ 145,600	$ 109,200	$ 49,920	$ 286,000	$ 447,200	$ 1,037,920
Number of employees	60	35	140	315	210	760
Square feet of space occupied	15,000	10,000	20,000	40,000	100,000	185,000
Hours of press time				30,000	60,000	90,000

Exercise 4B-4 (Algo) Direct Method [LO4-10]

Administration is allocated based on number of employees; Janitorial based on space occupied; and Maintenance based on hours of press time.

Required:

Assuming the company uses the direct method rather than the step-down method, how much cost would be assigned to each operating department?

Note: Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.

(Please Create the charts)