Memphis manufacturing has two service departments, Ask an Expert

Accounting

Memphis Manufacturing has two service departments, maintenance and personnel, and three production departments, fabrication, assembly, and packaging. Service costs are allocated to producing departments using the direct method. Information on overhead in each department and possible allocation bases appears below:

Maintenance Personnel Fabrication Assembly Packaging
Cost $180,000 $224,000
Machine Hours 10,000 30,000 50,000
Employees 8 4 40 30 30

How much maintenance cost will be allocated to packaging?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M948883

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