Question One Labaid Ltd Provides Radiological Services Despite The Variety Of Patients Seen At Labaid The Radiological 1 (47.24 KiB) Viewed 52 times
Question One Labaid Ltd Provides Radiological Services Despite The Variety Of Patients Seen At Labaid The Radiological 2 (47.24 KiB) Viewed 52 times
Question One Labaid Ltd Provides Radiological Services Despite The Variety Of Patients Seen At Labaid The Radiological 3 (47.24 KiB) Viewed 52 times
QUESTION ONE LabAid Ltd provides radiological services. Despite the variety of patients seen at LabAid, the radiological services involve only two operating departments (Daily Patient and Radiology) and two service departments (Administrative Services and Maintenance Services). For the first quarter of 2022, LabAid ineurs the following costs in its four departments: Department Overhead costs Daily Patient £350,000 Radiology £300,000 Administrative Services £50,000 Maintenance Services £55,000 The actual level of support relationships among the four departments for the first quarter of 2022 was: Used by Administrative Maintenance Daily Services Services Patient Radiology Supplied Administrative 25% 40% 35% Services by Maintenance Services 10% 30% 60% The Administrative Services support percentages are based on number of employees. The Maintenance Services support percentages are based on total labour hours. Required: a) Allocate the service department costs to the two operating departments using the direct method. (10 marks) b) Allocate the service department costs to the two operating departments using i) the step-down method (Allocate Administrative Services first) (ii) the step-down method (Allocate Maintenance Services first) (30 marks)
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