City Medical Clinic Has Two Service Departments,Building Services and Energy,and

Essay

City Medical Clinic has two service departments,Building Services and Energy,and three operating departments,Pediatrics,Geriatrics,and Surgery.The clinic allocates the cost of Building Services on the basis of square footage and Energy on the basis of patient days.No distinction is made between variable and fixed costs.Budgeted operating data for the year just completed follow:
Required:
a.Prepare a schedule to allocate service department costs to operating departments by the direct method (round all dollar amounts to the nearest whole dollar).
b.Prepare a schedule to allocate service department costs to operating departments by the step-down method,allocating Building Services first (round all amounts to the nearest whole dollar).