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QUESTION
The company has two production departments: Machining and Assembly. There are three support service departments: Human Resources (HR), Maintenance,...
The company has two production departments: Machining and Assembly. There are three support service departments: Human Resources (HR), Maintenance, and Computer Aided Design (CAD). The budgeted costs in the company's service departments during the year are as follows: HR $250,000, Maintenance $230,000 and CAD $350,000. The usage of these service departments' output for the year ended 31 December 2017 are as follows:
The company has two production departments: Machining and Assembly. There are threesupport service departments: Human Resources (HR), Maintenance, and Computer AidedDesign (CAD). The budgeted costs in the company's service departments during the year are asfollows: HR $250,000, Maintenance $230,000 and CAD $350,000. The usage of these servicedepartments' output for the year ended 31 December 2017 are as follows:User DepartmentsServiceProviderAllocation baseSupport DepartmentsProductionDepartmentsHRMaintenanceCADMachining |AssemblyHRStaff numbers5005004 0005 000MaintenanceMachinery value($000)5003 5004 000CADDesign requests4 5001 500Required:(@) Calculate the total overhead costs from the three service departments allocated to theMachining and Assembly departments using the step down method of allocation.