Evergreen Company Has Two Support Departments (S1 and S2) and Two

question 91

Multiple Choice

Evergreen Company has two support departments (S1 and S2) and two producing departments (P1 and P2) . Department S1 costs are allocated on the basis of number of employees, and Department S2 costs are allocated on the basis of space occupied expressed in square feet. Data on direct department costs, number of employees, and space occupied are as follows:
If Evergreen uses the direct method, the ratio representing the portion of Department S2 allocated to P1 is

• A) 1,500/5,000.
• B) 1,500/4,000.
• C) 1,500/5,500.
• D) 1,500/2,000.

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Definitions:

Larger Sample Variance

Refers to a greater dispersion or spread of a set of sample data points from their mean, compared to another set of data points.

F-test

A statistical test used to compare the variances of two populations and is based on the F-distribution.

One-tailed Test

A statistical hypothesis test in which the region of rejection is on only one side of the sampling distribution.

Population Variances

The squared deviation of a set of values in a population from their mean, representing the dispersion within the population.