Motlop Manufacturing
the Motlop Manufacturing Company Has Two Service Departments

question 45

Multiple Choice

Motlop Manufacturing
The Motlop Manufacturing Company has two service departments and two producing departments. The following data are available for 2013.
$\begin{array}{lcccc} &\text { Service }&\text { Service } & \text { Producing } & \text { Producing }\\&\text { Dept. 1 }&\text { Dept. 2 }&1&2\\\hline \text { Department Costs } & \$ 10000 & \$ 15000 & \$ 90000 & \$ 70000 \\\text { Machine hours } & 10000 & 5000 & 10000 & 20000 \\\text { Labour hours } & 5000 & 5000 & 12000 & 8000\end{array}$
The costs of service departments 1 and 2 are allocated on the basis of machine hours and labour hours respectively. Service department 1 is allocated first.
-Assuming that Motlop Manufacturing Company uses the direct method of allocating service costs,the amount of service department 1 costs allocated to producing 1 would be: (If necessary,round your answer to the nearest whole number. )

• A) $5250
• B) $3000
• C) $4800
• D) $3333

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