ACCOUNTING- The Long Term Care Plus Company has two service departments

QUESTION

The Long Term Care
Plus Company has two service departments — actuarial and premium rating, and
two production departments — marketing and sales. The distribution of each
service department’s efforts to the other departments is shown below:

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The direct operating
costs of the departments (including both variable and fixed costs) were as
follows:

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Required:
Determine the total
cost allocated to the Marketing and Sales Department using the direct method.

ANSWER:

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