A. Rhode Island Co. Has two support departments, Information Systems (S) and Maintenance (M), and...
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Accounting
A. Rhode Island Co. Has two support departments, Information Systems (S) and Maintenance (M), and two production departments, Assembly (Mo) and Completion (T). The variable indirect costs incurred during 2022 for the four departments were as follows and that the support departments serve the production departments and serve each other with the indicated proportions
S
M
Mo
T
Variable indirect costs
$40,000
$72,000
-
-
Services provided by S
---
30%
30%
40%
Services provided by M
25%
---
30%
45%
Suppose that you distributed the fixed indirect costs based on the service percentages dedicated by the support departments, how will the total indirect costs (variable and fixed) of the support departments be distributed among the operational departments (approximate)? Use the direct method.
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