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Two products, X and Y. RST Ltd. has two production departments: Machining and Finishing. There are three service departments.human Resource (HR), Maintenance & Design. The budgeted costs in these service departments are asfollows:HR)Maintenance )Design (3)VariableFixed1,00,0004,00,0001,60,0001,00,0003,00,0006,00.0005,00,0004,60,0007,00.000The usage of these Service Departments' output during the year just completed is as follows:Provision of Service output (in hours of service)Providers of ServiceUsers of serviceHRMaintenanceDesignHRMaintenance500500500DesignMachiningFinishing4,0003,5004,5005,0004,0001,500Total10,0008,0006,000Required:i) Use the direct method to re-apportion RST Ltd.'s service department cost to its production departments.ii) Determine the proper sequence to use in re-apportioning the firm's serviceiii) Use the Step-down method to reapportion the firm's service department. |
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