Kevin Company Has Two Service Departments,Maintenance and Personnel

question 106

Multiple Choice

Kevin Company has two service departments,Maintenance and Personnel.Kevin Company also has two production departments,Mixing and Finishing.Maintenance costs are allocated based on square footage while personnel costs are allocated based on number of employees.The following information has been gathered for the current year: Assume the step-down method is used to allocate service department costs and the Personnel Department is allocated first.What is the amount of cost allocated from the Personnel Department to the Finishing Department?

• A)$31,500
• B)$42,000
• C)$72,000
• D)$105,000

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Definitions:

Fixation

In psychology, an obsessive focus or attachment to a person, situation, or stage of development.

Psychosexual Stage

A concept in Freudian psychology referring to a series of developmental stages in childhood, each characterized by a focus on pleasure from a particular body area.

Pleasure-Seeking Energies

An inclination towards actions or experiences that result in enjoyment or satisfaction, driven by internal desires.

Reaction Formation

A defense mechanism by which individuals reduce anxiety by taking up the opposite feeling, impulse, or behavior.