(CPA)Parat College Allocates Support Department Costs to Its Individual Schools

question 28

Multiple Choice

(CPA) Parat College allocates support department costs to its individual schools using the step-down method. Information for May 2003 follows: Support Departments
Maintenance Power
Cost incurred $99,000 $54,000
Service percentages provided to:
Maintenance ---- 10%
Power 20% ----
School of Education 30% 20%
School of Technology 50% 70%
100% 100%
What is the amount of May 2003 support department costs allocated to the School of Education?

• A)$40,500
• B)$42,120
• C)$46,100
• D)$49,125

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