Assume Potter's Manufacturing Has a Janitorial Department That Supports the Maintenance

question 16

Multiple Choice

Assume Potter's Manufacturing has a Janitorial Department that supports the Maintenance Department and two line activity departments, Department A and Department
B. Janitorial and Maintenance are allocated to other departments on the basis of square footage of space used. The amount of space used by each department is listed below:

The expected cost for the Janitorial Department is expected to be $9,000. Using the step-down method, what is the amount of janitorial costs will be allocated to Maintenance?

• A) $0
• B) $540
• C) $562.50
• D) $5,400
• E) None of the above.

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