Use the Following Information for the Next 4 Questions

question 61

Multiple Choice

Use the following information for the next 4 questions. Bronson, Inc. has two support departments, Personnel and Maintenance, whose costs are to be allocated to the operating department's overhead for budgeting and inventory costing purposes. Projected amounts for the next year follow:
-If the step-down method is used and the largest department (in terms of direct costs) is allocated first, the total cost allocated to assembly will be

• A) $32,200
• B) $39,933
• C) $29,317
• D) $24,500

---

Definitions:

Inventory Cost

The total expense associated with holding and managing stock, including warehousing and spoilage costs.

Seasonal Demand

Fluctuations in the demand for certain products or services at particular times of the year.

Extending Credit

The practice of allowing a buyer to purchase goods or services now and pay for them at a later date, often involving the assessment of the buyer's creditworthiness.

Facilitating Function

Activities that assist in the movement of goods from the producer to the consumer, including transportation, storage, and financial services.