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Problem 7-38 (Algo) Departmental Cost Allocation [LO 7-3] Solexx Corporation allocates its service department overhead costs to producing departments. This information is for the month of June: Overhead costs incurred Service provided to departments Maintenance Utilities Producing-A Producing-B Totals 1. 2 3 The direct method The step method The reciprocal method PH Service Departments Producing Department A $ $ Maintenance $ 324,000 10% 20 70 100% Required: What is the amount of maintenance and utilities department costs distributed to producing departments A and B for June using (1) the direct method, (2) the step method (maintenance department first), and (3) the reciprocal method? (Do not round intermediate calculations. Round final answers to the nearest dollar.) Utilities X Answer is not complete. 357,474 $ 350 274 x $ 678,000 Producing Department B 644,526 5% 40 55 100% Total Service Department Cost $ 1,002,000 $ 350,274 S 0

Problem 7.38 (Algo) Departmental Cost Allocation [LO 7.3] Solexx Corporation allocates its service department overhead costs to producing departments. This information is for the month of June: Required: What is the amount of maintenance and utities department costs distributed to producing departments A and B for June using (1) the direct method, (2) the step method (maintenance department first), and ( 3 ) the reciprocal method? (Do not round intermediote calculations. Round final answers to the nearest dollar.)

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