Support Department Cost Allocation—Reciprocal Services Method Blue Africa Inc. produces laptops and desktop computers. The company’s production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company’s production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $260,000. The total cost of the Cafeteria Department is $698,000. The number of employees and the square footage in each department are as follows:   Employees   Square Feet Security Department 10          580          Cafeteria Department 22          2,400          Laser Department 40          4,800          Forming Department 50          800          Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and to each of the production departments.   Cafeteria Department   Laser Department   Forming Department Security Department cost allocation $fill in the blank 1   $fill in the blank 2   $fill in the blank 3

Support Department Cost Allocation—Reciprocal Services Method

Blue Africa Inc. produces laptops and desktop computers. The company’s production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company’s production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $260,000. The total cost of the Cafeteria Department is $698,000. The number of employees and the square footage in each department are as follows:

  Employees   Square Feet
Security Department 10          580         
Cafeteria Department 22          2,400         
Laser Department 40          4,800         
Forming Department 50          800         

Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and to each of the production departments.

  Cafeteria
Department
  Laser
Department
  Forming
Department
Security Department cost allocation $fill in the blank 1   $fill in the blank 2   $fill in the blank 3
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