Hanung Corp Has Two Service Departments,Maintenance and Personnel

question 115

Multiple Choice

Hanung Corp has two service departments,Maintenance and Personnel.Maintenance Department costs of $350,000 are allocated on the basis of budgeted maintenance-hours.Personnel Department costs of $110,000 are allocated based on the number of employees.The costs of operating departments A and B are $184,000 and $276,000,respectively.Data on budgeted maintenance-hours and number of employees are as follows:

Using the step-down method,what amount of Maintenance Department cost will be allocated to Department A if the service department with the highest percentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations. )

• A)$231,452
• B)$121,677
• C)$50,111
• D)$159,444

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Definitions:

Periodic Analysis

The examination or evaluation of data or performance at set intervals over time to identify trends, patterns, or areas needing improvement.

Mass Production

A manufacturing method that produces large volumes of standard products through efficient processes and assembly lines, often utilizing specialized machinery and labor.

Assembly-Line System

A manufacturing process in which parts are added to a product in a sequential manner using optimally planned logistics to create a finished product efficiently.

Uniform Products

Uniform products refer to goods that are standardized and identical, with no variation in quality, design, or features across the items produced.