San Juan Minerals (SJM) has two service departments and two operating departments. Operating data for...
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Accounting
San Juan Minerals (SJM) has two service departments and two operating departments. Operating data for these departments for last year are as follows: Departmental costs Machine hours Number of employees Service Departments Maintenance Cafeteria $ 48,000 $ 45,000 2,000 1,000 40 30 Operating Departments Mining Processing $ 70,000 $ 130,000 11,000 9,000 400 360 Costs of the Maintenance Department are allocated on the basis of machine hours. Cafeteria costs are allocated on the basis of number of employees. San Juan Minerals does not distinguish between variable and fixed overhead costs. Assume that San Juan Minerals uses the step-down method to allocate service department costs, starting with Maintenance. The total overhead allocated from Maintenance to Mining would be closest to: Multiple Choice $25,143 $51,150 $16,800 $22,957
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