CAPE Accounting Unit 2 · 2013 · Paper 2 · Question 1(a)(i)

Tell Company has three service departments (A, B, C) and two production departments (P1, P2). Overhead costs and allocation bases (number of employees, square feet of space occupied, machine hours) are given in Table 1. Service department costs are allocated using the step-down method in the order: number of employees, space occupied, and machine hours. No distinction is made between fixed and variable costs.

Using the provided answer sheet, prepare a schedule to allocate service department costs to production departments using the step-down method.

This question uses a figure or table from the paper — you'll see it when you practise.