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Service Department Allocations

__SD I__ _SD II_ _SD III _PD I__ _PDII_
Total Overhead cost $100,000 $20,000 $15,000

# Employees 64 136 24 400 440
Sq Ft Space 500 300 600 2000 2400
Labor Hours 3500 1500
Machine Hours 6500 3500

SD I COSTS ARE ALLOCATED FIRST ON THE BASIS OF NUMBER OF EMPLOYEES.
SDII COSTS ARE ALLOCATED SECOND ON THE BASIS OF FLOOR SPACE.
SDIII COSTS ARE ALLOCATED THIRD ON THE BASIS OF MACHINE HOURS.

SD I COSTS ALLOCATED TO SD II _________________________

2. SD I COSTS ALLOCATED TO PD I _________________________

3. SD II COSTS ALLOCATED TO SD III _________________________

4. SD II COSTS ALLOCATED TO PD II _________________________

5. SD III COSTS ALLOCATED TO PD I _________________________

6. PD I COSTS ALLOCATED TO SD II _________________________

7. PD II COSTS ALLOCATED TO SD I _________________________

8. SD I COSTS ALLOCATED TO PD II _________________________

9. ASSUMING ALLOCATED COSTS ARE PRORATED ON THE BASIS OF LABOR HOURS

IN PD I, THE RATE PER LABOR HOURS IS

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Solution Summary

The solution allocates service department cost to production department.

$2.19