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Unformatted text preview: Charles Blackstone ACC/561 ACCOUNTING Week 5 Homework March 7, 2011 Personnel Administrative Residential Commercial Total Res/ Com Total Admin/Res/ Com Grand Total Direct Department Costs $7,000.00 $90,000.00 $240,000.00 $400,000.00 $640,000.0 $730,000.00 $1,370,000.0 Number of Employees 6 10 36 24 60 70 Direct Method Direct Department Cost $70,000.00 $90,000.00 $240,000.00 $400,000.00 Personnel Allocation $42,000.00 $28,000.00 Administrative Allocation $33,750.00 $33,750.00 Total Cost $315,750.00 $484,250.00 12-59 Allocating costs Using Direct and Step-Down Methods 1. The total costs for the Residential department using the direct method-$315,750 Total costs for the Commercial department using the direct method-$484,250 2. The total costs for the Residential department using the step-down method-$313,500 3. The total costs for the Commercial department using the step-down method-$486,500 4. I would recommend the company to use step-down method as it counts effects of other service departments provided to both service and producing departments....
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This note was uploaded on 06/13/2011 for the course ACCT561 SH2MB906 taught by Professor Nathanielmanning during the Spring '09 term at University of Phoenix.
- Spring '09