Hanung Corp Has Two Service Departments, Maintenance and Personnel

question 97

Multiple Choice

Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $310,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $190,000 are allocated based on the number of employees. The costs of operating departments A and B are $200,000 and $300,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows:
Production
Support DepartmentsDepartments

Using the direct method, what amount of Maintenance Department costs will be allocated to Department A? (Do not round any intermediary calculations.)

• A) $145,277
• B) $334,211
• C) $133,684
• D) $207,211

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Definitions:

Formal Operational Reasoning

A stage in Piaget's theory of cognitive development where individuals are able to think abstractly and logically.

Selective Attention

The cognitive process of focusing on certain information while ignoring other stimuli.

Abstract Thought

The ability to think about objects, principles, and ideas that are not physically present.

Logical Thought

A form of reasoning and understanding that is based on strict principles of validity.