Castle Company Has Two Service Departments and Two User Departments

question 19

Multiple Choice

Castle Company has two service departments and two user departments.The number of employees in each department is The fixed costs of the Personnel Department are allocated on a basis of the number of employees.If these costs are budgeted at $37,125 during a given period,the amount of cost allocated to the Cafeteria under the step method would be

• A)$0.
• B)$1,718.75.
• C)$1,687.50.
• D)$1,802.18.

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Definitions:

Future Value

The value of a current asset at a specified date in the future based on an assumed rate of growth over time.

Price

The amount of money or consideration exchanged for the ownership or use of a good or service.

Business

An organization or enterprising entity engaged in commercial, industrial, or professional activities, often structured to produce and sell goods and services for profit.

Present Value

Present value represents the current value of a future amount of money or series of cash flows, discounted at a certain rate of return.