Newton Company Has Two Support Departments, Maintenance Department (MD) and Personnel

Multiple Choice

Newton Company has two support departments, Maintenance Department (MD) and Personnel Department (PD) , and two producing departments, P1 and P2. The Maintenance Department costs of $120,000 are allocated on the basis of standard service hours used. The Personnel Department costs of $18,000 are allocated on the basis of number of employees. The direct costs of Departments P1 and P2 are $36,000 and $60,000, respectively.
Data on standard service hours and number of employees are as follows:
$$\begin{array} { l c c c c } & \text { Maint. } & \text { Person. } & \text { Dept. } & \text { Dept. } \\& \text { Dept. } & \text { Dept. } & \text { P1 } & \text { p2 } \\\text { Standard service hours used } & 400 & 200 & 1,200 & 600 \\\text { Number of emplayes }& 20 & 40 & 180 & 180 \\\text { Direct labour hours } & 200 & 200 & 1,000 & 1,000\end{array}$$

-Refer to the figure.What are the total overhead costs associated with P2 after allocating the Maintenance and Personnel Departments using the direct method?

A) $60,000
B) $69,000
C) $100,000
D) $109,000