Cope, Inc Has the Following Costs and Usage Data for Its

question 43

Multiple Choice

Cope, Inc. has the following costs and usage data for its support departments: If the step-down method is used, and the order of allocation is department B first, then A, and finally C, the amount of support department A costs allocated to operating department 2 will be:

• A) $15,000
• B) $23,250
• C) $24,000
• D) $18,600

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Definitions:

Floral Bouquets

Arrangements of flowers often used for decorative purposes or given as gifts for special occasions, composed of various types of flowers and foliage.

Activity-based Costing

A costing method that assigns overhead and indirect costs to specific activities, improving the accuracy of product and service pricing.

Idle Capacity

Unused production capability or facilities that could be used to produce more goods but are not currently being utilized due to lack of demand or efficiency.

Plantwide Overhead Rate

A single overhead rate calculated by dividing total manufacturing overhead costs by the total allocation base for the entire plant.