Parat College Allocates Support Department Costs to Its Individual Schools $\quad$

question 85

Multiple Choice

Parat College allocates support department costs to its individual schools using the step-down method. Information for May 2017 follows: $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Support Departments }$
$\begin{array}{lcc}& \underline{\text { Maintenance}}& \underline{\text { Power }}\\ \text { Cost incurred } & \$ 99,000 & \$ 54,000 \\ \text { Maintenance } & \text {---- } & 10 \% \\ \text { Power } & 20 \% & \\ \text { School of Education } & 30 \% & 20 \% \\ \text { chool of Technology } & 50 \% & 70 \% \\&100\%&100\%\end{array}$ What is the amount of May 2017 support department costs allocated to the School of Education?

• A) $40,500
• B) $42,120
• C) $46,100
• D) $49,125

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Definitions:

Supply of Beef

The total amount of beef that producers are willing and able to sell at a given price level.

Equilibrium Price

The price at which the quantity of a product demanded by consumers equals the quantity supplied by producers, leading to market stability.

Equilibrium Quantity

The amount of products or services available that matches the amount requested at the price where supply and demand balance.

Supply Increases

A situation where the quantity of a good or service that producers are willing to supply at a certain price rises.