ABC Corporation has three service departments with the following costs and activity base:
Service Department Cost Activity base
Graphics Production$ 200,000 # of copies
Accounting $500,000 # of invoices processed
Personnel Department $400,000 # of employees
ABC has three operating divisions, Micro, Macro, and Super. Their revenue, cost and activity information are as follows:
Micro Macro Super
Direct Revenues 700,000 850,000 650,000
Direct Operating Expenses 50,000 70,000 100,000
# of copies made 20,000 30,000 50,000
# invoices processed 700 800 500
# of employees 130 145 125
A. How much service department cost will be allocated to the Micro Division?
B. How much service department cost would be allocated to the Macro Division?