Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and...
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Accounting
Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of August follow:
Proportion of Services Used by
Department
Direct Costs
Maintenance
Cafeteria
Machining
Assembly
Machining
$
105,000
Assembly
76,400
Maintenance
47,200
0.2
0.6
0.2
Cafeteria
38,000
0.8
0.1
0.1
Assume that both Machining and Assembly work on just two jobs during the month of August: CM-22 and CM-23. Costs are allocated to jobs based on machine-hours in Machining and labor-hours in Assembly. The number of labor- and machine-hours worked in each department are as follows:
Machining
Assembly
Job CM-22:
Machine-hours
190
20
Labor-hours
20
60
Job CM-23:
Machine-hours
50
50
Labor-hours
40
120
Required: How much of the service department costs allocated to Machining and Assembly in the direct method should be allocated to Job CM-22? How much should be allocated to Job CM-23? (Round "Department rate" to 2 decimal places.)
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