Question: Maersk Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a direct allocation method where service departments are allocated only to production departments. All allocations are based on total employees. Computer Operations has costs of $195,000 and Maintenance Services has costs of $200,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Packaging Department?
Employees are:
Computer Operations 2
Maintenance Services 2
Mixing Department 7
Packaging Department 5
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