The Hsu Manufacturing Company Has Two Service Departments: Maintenance and Accounting.The

question 137

Multiple Choice

The Hsu Manufacturing Company has two service departments: Maintenance and Accounting.The Maintenance Department's costs of $300,000 are allocated on the basis of machine hours.The Accounting Department's costs of $120,000 are allocated on the basis of the number of employees within a specific department.The direct departmental costs for A and B are $300,000 and $500,000,respectively. $$\begin{array} { | l | r | r | r | r | } \hline & \text {Maint } & \text { Acctg } & A & B \\\hline \text { Machine hours } & 480 & 20 & 2,300 & 200 \\\hline \text { Number of employees } & 2 & 2 & 8 & 4 \\\hline\end{array}$$ What is the Maintenance Department's cost allocated to Department B using the step method and assuming the Maintenance Department's costs are allocated first?

• A) $276,000.
• B) $230,000.
• C) $322,000.
• D) $23,810.

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Definitions:

Complete Propositions

Statements or assertions that convey a complete idea, capable of being true or false, and usually containing both a subject and a predicate.

Inclusive Sense

Refers to an understanding or interpretation that aims to encompass or include all relevant aspects or elements.

Disjunction

A compound proposition containing two or more component propositions (the disjuncts) and asserting that at least one of them is true.

Disjuncts

Components of a logical disjunction, or an "or" statement, where either one or the other (or both) of the elements is true.