The CHOAM Company uses the step-down method to allocate its support departments (A, B, and...
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Accounting
The CHOAM Company uses the step-down method to allocate its support departments (A, B, and C) costs to production departments (X and Y). The overhead costs of support Department A are to be allocated first, followed by the costs of B, and then those of C. The distribution of services is as follows:
| Services Supplied | To A | To B | To C | To X | To Y |
| From A | 10% | 50% | 20% | 20% | |
| From B | 40% | 15% | 30% | 15% | |
| From C | 25% | 25% | 20% | 30% |
The percentage of B's costs that should be allocated to Y is closest to:
| a. | 5% | |
| b. | 15% | |
| c. | 33% | |
| d. | 25% |
The percentage of C's costs that should be allocated to B is closest to:
| a. | 0% | |
| b. | 10% | |
| c. | 20% | |
| d. | 33% |
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