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Midland Resources has two production departments (Fabrication and Assembly) and three service departments (Engineering, Administration,...

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Accounting

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Midland Resources has two production departments (Fabrication and Assembly) and three service departments (Engineering, Administration, and Maintenance). During July, the following costs and service department usage ratios were recorded. Engineering Supplying Department Engineering Administration Maintenance Direct cost 10% Using Department Administration Maintenance 50% 20% 20% 0 $209,500 $25,000 0 Fabrication 10% 50% 30% $190,000 Assembly 40% 20% 50% $50,000 0 $26,000 Required: Allocate the service department costs to the two operating departments using the reciprocal method. (Do not round intermediate calculations.) Allocated to: Fabrication Costs Assembly Engineering Administration Maintenance Total

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