Q1) Krum Lawn Equipmenthas five departments, of which Casting, and Finishing are producing departments. Maintenance,...

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Accounting

Q1) Krum Lawn Equipmenthas five departments, of which Casting, and Finishing are producing departments. Maintenance, Product Movement, and Inspection are service departments. The distribution of the service departments is as follows:

Service Departments & Their Total Costs

Percent of Services Provided To

Maintenance

Product Movement

Inspection

Casting

Finishing

Maintenance ($84,000)

0%

5%

25%

50%

20%

Product Movement ($160,000)

0%

10%

5%

45%

40%

Inspection ($38,000)

0%

15%

5%

20%

60%

Required:

Use the Step-down methodto allocate the service departments' costs.

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