Answer the Following Questions Using the Information Below:
Goldfarb's Book

question 40

Multiple Choice

Answer the following questions using the information below:
Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $350,000 are allocated on the basis of budgeted warehouse-hours. Data Center Department costs of $150,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $250,000 and $300,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows:
$$\begin{array} { | l | c | c | c | c | } \hline & { \text { Support Departments } } &&{ \begin{array} { c } \text { Production } \\\text { Departments }\end{array} } \\\hline & \begin{array} { c } \text { Warehouse } \\\text { Department }\end{array} & \begin{array} { c } \text { Data Center } \\\text { Department }\end{array} & \text { Music } & \text { Books } \\\hline \text { Budgeted costs } & \$ 350,000 & \$ 150,000 & \$ 125,000 & \$ 150,000 \\\hline \text { Budgeted warehouse-hours } & \text { NA } & 500 & 1,000 & 1,500 \\\hline \text { Number of computer hours } & 200 & \text { NA } & 800 & 1,000 \\\hline\end{array}$$
-Using the step-down method,what amount of Data Center Department cost will be allocated to Department Music if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up)

• A) $117,342
• B) $66,667
• C) $92,592
• D) $83,333

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Definitions:

Too Much Control

A situation where excessive governance or oversight can stifle creativity, decision-making, or operational efficiency.

Orderliness

The quality of being methodically organized and systematic in arrangement or function.

Information Gaps

Situations where a disparity or lack of necessary information exists, making it difficult to make informed decisions or understandings.

Opportunity-driven

Pursuing actions based on perceived potential for growth or benefit.