Hanson Printing Operates a Copy Business at Two Different Locations

Essay

Hanson Printing operates a copy business at two different locations.Hanson Printing has one support department that is responsible for cleaning,service,and maintenance of its copying equipment.The costs of the support department are allocated to each copy centre on the basis of total copies made.
During the first month,the costs of the support department were expected to be $100,000.Of this amount,$30,000 is considered a fixed cost.During the month,the support department incurred actual variable costs of $64,000 and actual fixed costs of $36,000.
Normal and actual activity (copies made)are as follows:
$$\begin{array} { l c c } & \text { Copy Centre 1 } & \text { Copy Centre 2 } \\\text { Normal activity (copies) } & 3,000,000 & 2,000,000 \\\text { Actual activity (capies) } & 2,500,000 & 2,200,000\end{array}$$
a.For purposes of performance evaluation,calculate the fixed costs allocated to Copy Centre 1.
b.For purposes of performance evaluation,calculate the fixed costs allocated to Copy Centre 2.
c.Calculate the support department costs not allocated to the two copy centres.