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Rallys's Wood Company is in the process of selecting cost drivers that could be used as the basis for allocating various service department costs to...
Rallys’s Wood Company is in the process of selecting cost drivers that could be used as the basis for allocating various service department costs to its three production divisions: Cutting, Milling and Finishing. Select the most appropriate allocation base for each type of service department cost. Select from among the four allocation bases in the following list. In recording your answer, use the abbreviations provided in the list. Some allocation bases will be used for more than one answer.Possible Choices of Allocation BasesNumber of EmployeesUnits of Production CapacitySquare Footage OccupiedBudgeted Production Department OverheadType of Service Department Cost to be Allocated to the Producing DivisionsCost of operating a uniform cleaner that services all employees