Allocate the support department costs to the operating departments using the algebraic method. 1 answer below »
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(Algebraic method) The following chart indicates the percentage of support department services used by other departments. Service departments are designated S1, S2, and S3; operating departments are designated RP1 and RP2.
SERVICES USED
Department
S1
S2
S3
RP1
RP2
S1
n/a
10%
20%
30%
40%
S2
40%
n/a
30
20
10
S3
20
30
n/a
40
10
Direct costs of the period were $170,000, $360,000, and $600,000 for S1, S2, and S3,respectively. Allocate the support department costs to the operating departments using the algebraic method.
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