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

question 12

Multiple Choice

Diprima 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 Pediatric.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 Pediatric Department cost after allocations is closest to:

• A)$233,732
• B)$238,715
• C)$238,298
• D)$205,318

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Directors

Individuals elected by shareholders to manage the overall affairs of a corporation and set its strategic direction.