Goodland Corporation Uses the Step-Down Method to Allocate Service Department

question 15

Multiple Choice

Goodland Corporation uses the step-down method to allocate service department costs to operating departments. The company has two service departments, Service Department A and Service Department B, and two operating departments, Operating Department X and Operating Department Y. Data concerning those departments follow: Service Department A costs are allocated first on the basis of allocation base A and Service Department B costs are allocated second on the basis of allocation base B.
-In the first step of the allocation,the amount of Service Department A cost allocated to the Operating Department X is closest to:

• A)$9,760
• B)$20,608
• C)$19,800
• D)$18,032

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Definitions:

Pattern 2

A sequential or repeating model or design that falls under a secondary category or variation.

Relate

To establish a connection or identify similarities between two or more concepts, situations, or entities.

Culture

The sum of attitudes, customs, and beliefs that distinguishes one group of people from another, transmitted from generation to generation.

Bilingual

Refers to the ability to understand and communicate fluently in two languages.