Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $360,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $110,000 are allocated based on the number of employees. The costs of operating departments A and B are $188,000 and $282,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows
Support Production
Departments Departments
Maintenance Personnel
Department Department A B
Budgeted costs $360,000 $110,000 $188,000 $282,000
Budgeted maintenance-hours NA 880 1230 680
Number of employees 60 NA 290 630
Using the direct method, what amount of Maintenance Department costs will be allocated to Department B?
a. $100,398
b. $128,168
c. $87,742
d. $167,330
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