Kraft,IncHas Two Producing Departments Normal Support Department Usage Is 8,000 Hours Each for Department

question 24

Multiple Choice

Kraft,Inc.has two producing departments.Each producing department is held responsible for a share of the costs of a support department. Actual and budgeted data are as follows:
$\begin{array}{lr}\text { Support department hours used: }\\\text { Department X } & 12,000 \\\text { Department Y } & \underline{4,000} \\\text { Total hours } & \underline{16,000}\\\\\text { Support department costs: }\\\text { Actual support department costs } & \$ 48,000 \\\text { Budgeted fixed department costs } & \$ 20,000 \\\text { Budgeted variable rate per hour } & \$ 2.50\end{array}$
Normal support department usage is 8,000 hours each for Department X and Department Y.
-Assuming the direct method is used and the purpose is product costing,what are the support department costs allocated to Department X?

• A)$20,000
• B)$20,400
• C)$24,800
• D)$30,000