Lakehead College Has Two Service Departments, the Library and Computing $\quad$

question 18

Essay

Lakehead College has two service departments, the Library and Computing Services, that assist the School of Business and the School of Health. Budgeted costs of the Library and Computing Services are $800,000 and $1,800,000, respectively. Usage of the service departments' output during the year is anticipated to be: $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\underline {\text { Provider of Service }}$
$\begin{array} { l l l } && \underline {\text { Computing } }\\\underline {\text { User of Service } }& \underline { \text { Library } } & \underline {\text { Services } }\\\text { Library } & \ldots & 10 \% \\\text { Computing Services } & \ldots & - \\\text { School of Business } & 20 \% & 60 \% \\\text { School of Health } & 80 \% & 30 \%\end{array}$ Required:
A. Use the direct method to allocate the costs of the Library and Computing Services to the School of Business and the School of Health.
B. Repeat requirement "A" using the step-down method. Lakehead allocates the cost of Computing Services first.

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Definitions:

Thrombin

An enzyme in blood plasma that causes the clotting of blood by converting fibrinogen to fibrin.

Prothrombin

A protein present in blood plasma that is converted into active thrombin during coagulation, playing a key role in blood clot formation.

Fibrinogen

A soluble plasma protein that is converted to the insoluble protein fibrin during blood clotting.

Fibrin

A fibrous protein involved in the clotting of blood, formed from fibrinogen in response to injury.