(Appendix 4B)Hancock Company Has Two Service Departments-Factory Administration and Maintenance-And

Essay

(Appendix 4B)Hancock Company has two Service Departments-Factory Administration and Maintenance-and two Producing Departments.Selected information relating to these departments follow:

The company allocates Service Department costs using the step-down method. Costs of Factory Administration are allocated on the basis of the number of employees. Costs of Maintenance are allocated on the basis of labour hours. Allocation begins with the Factory Administration Department.

Required:

Prepare a schedule showing the allocation of Service Department costs to the other departments.