FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Snowy River Stallion Inc. produces horse and rancher equipment. Costs from Support Department 1 are allocated based on the number of employees. Costs from Support Department 2 are allocated based on asset value. Relevant department information is provided in the following table:

 

Using the sequential method of support department cost allocation, determine the total costs from Support Department 1 (assuming they are allocated first) that should be allocated to Support Department 2 and to each of the production departments.

Support
Department 1 Department 2 Department 1 Department 2
Support
Production
Production
Number of employees
9
7
25
18
Asset value
$1,150
$670
$6,230
$5,100
Department cost
$20,000
$15,500
$99,000
$79,000
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Transcribed Image Text:Support Department 1 Department 2 Department 1 Department 2 Support Production Production Number of employees 9 7 25 18 Asset value $1,150 $670 $6,230 $5,100 Department cost $20,000 $15,500 $99,000 $79,000
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