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

question 22

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 Warehouse 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) $233,333
• B) $116,667
• C) $243,333
• D) $121,667

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