The Mohawk-Hudson Company Is an Electric Utility Which Has Two

question 4

Multiple Choice

The Mohawk-Hudson Company is an electric utility which has two service departments, Accounting and Maintenance. It has two operating departments, Generation and Transmission. The company does not distinguish between fixed and variable service department costs. Maintenance Department costs are allocated on the basis of maintenance hours. Accounting Department costs are allocated to operating departments on the basis of accounting hours of service provided. Budgeted costs and other data for the coming year are as follows: The step-down method is used to allocate service department costs, with the accounting department being allocated first.
-The amount of Maintenance Department cost allocated to the Accounting Department would be:

• A) $0
• B) $69,315
• C) $75,000
• D) $88,000

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Definitions:

Cyclohexanone

An organic compound with the formula (CH2)5CO, characterized by a six-carbon ring with a ketone functional group.

Benzophenone

An organic compound with the formula (C6H5)2CO, commonly used in organic chemistry as a photoinitiator.

Diethyl Ether

An organic compound commonly used as a solvent, characterized by an oxygen atom connecting two ethyl groups.

1-Butanol

A primary alcohol with the chemical formula C4H9OH, characterized by a four-carbon straight chain terminating in a hydroxyl group.