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12 October, 05:39

Martina, Inc. has two service departments (Human Resources and Building Maintenance) and two production departments (Machining and Assembly). The company allocates Building Maintenance cost on the basis of square footage and allocates Building Maintenance first in step-down method. The square footage occupied by each department follows.

Human Resources 12,000

Building Maintenance 19,000

Machining 24,000

Assembly 32,000

Assuming use of the step-down method, over how many square feet would the Building Maintenance cost be allocated (i. e., spread) ?

Multiple Choice

87,000.

56,000.

31,000.

68,000.

More information is needed to judge.

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Answers (1)
  1. 12 October, 09:12
    0
    56,000

    Explanation:

    The calculation of square feet would the Building Maintenance cost be allocated is shown below:-

    Square feet over which Building Maintenance cost would be allocated = Square Footage of Machining + Square Footage of Assembly

    = 24,000 + 32,000

    = 56,000

    Therefore for computing the square feet would the Building Maintenance cost be allocated we simply applied the above formula.
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