A.) Using the direct method, calculate total costs for Department X and Department Y. B.) Use the information provided above. Using the step method, if Personnel Department costs are allocated first, calculate total costs for Dept. X and Dept. Y.

Airwalk Company has two service departments, Maintenance Department and Personnel Department, and two producing departments, X and Y. Maintenance Department costs are allocated on the basis of standard service hours used, and Personnel Department costs are allocated on the basis of number of employees. Data on standard service-hours and number of employees follows. Using the direct method, calculate total costs for Department X and Department Y.

Maint. Dept.

Person. Dept.

Dept. X

Dept. Y

Direct Costs$120,000$18,000$36,000$60,000Standard service hours used200100600300Number of employees5102520  

ANSWER FORMAT FOR A.)

ANSWER FORMAT FOR B.)

 S1Maint. Dept.S2Pers. Dept.P1Dept. XP2Dept. Y