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Snakesaw Inc Required:
A

Question 35

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Snakesaw Inc. has two service departments (S1 and S2) and two production departments (P1 and P2). S1 and S2 both use the number of employees as an allocation base. The following data are available:  Number of  Employees  Budgeted Cost  S1 40$172,000 S2 60250,000 P1 300660,000 P2 500840,000\begin{array} { l l l } & \text { Number of } & \\& \underline {\text { Employees }} & \underline {\text { Budgeted Cost }} \\\text { S1 } & 40 & \$ 172,000 \\\text { S2 } & 60 & 250,000 \\\text { P1 } & 300 & 660,000 \\\text { P2 } & 500 & 840,000\end{array} Required:
A. Assuming use of the direct method:
1. Over how many employees would S1's budgeted cost be allocated?
2. How much of S2's cost would be allocated to P1?
3. How much of P1's cost would be allocated to S1?
B. Assuming use of the step-down method:
1. How much of S1's cost would be allocated to S2? Navan allocates S1's costs prior to allocating those of S2.
2. How much of S2's total cost would be allocated to P2?
3. How much of S2's total cost would be allocated to S1?

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A.
1. 800 (300 + 500)
2. $93,750 [$250,0...

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