Question

In: Accounting

Betty's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs...

Betty's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs are allocated on the basis of warehouse-hours. Data Center Department costs are allocated based on the number of computer hours. The costs of departments, warehouse-hours and number of computer hours are as follows:

Support Departments

Operating Departments

Warehouse

Data Center

Music

Books

Departmental costs

$ 60,000

$40,000

$60,000

$70,000

Warehouse-hours

-

400

200

400

Computer hours

250

-

375

375

The total cost accumulated in the music department using the direct method is

$126,000

$104,000

$100,000

$130,000

The total cost accumulated in the music department using the step-down method is (assume the warehouse department goes first)

$126,000

$100,000

$130,000

104,000

The total cost accumulated in the music department using the reciprocal method is

Group of answer choices

$122,402

$102,222

$142,471

$127,778

Solutions

Expert Solution

ekkarill92 answered 1 year ago
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