Duda Clinic Uses the Step-Down Method to Allocate Service Department

question 16

Multiple Choice

Duda Clinic uses the step-down method to allocate service department costs to operating departments. The clinic has two service departments, Personnel and Information Technology (IT) , and two operating departments, Family Medicine and Geriatric Medicine. Data concerning those departments follow: Personnel costs are allocated first on the basis of employees and IT costs are allocated second on the basis of PCs.
-The total Geriatric Medicine Department cost after allocations is closest to:

• A)$163,616
• B)$188,179
• C)$194,726
• D)$194,717

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Definitions:

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