The budgets for operating department support


The accountant for Milton, Inc. is preparing the budgets for operating department support service costs. Maintenance costs are allocated based on square feet, and cafeteria costs are allocated based on number of employees. The following data have been collected:

Support Departments               Operating Departments

  Maintenance                      Cafeteria   Cutting     Packaging

Direct costs                          $50,000        $45,000       $275,000       $300,000

Number of employees            15                 10               150               250

Square feet                          1,500            2,000            3,500            4,000

If the direct method is used, maintenance costs allocated to the cutting department will be?

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Accounting Basics: The budgets for operating department support
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