(Solution) - A housekeeping support department budgets its costs at 40 000 -(2025 Original AI-Free Solution)

Paper Details

A housekeeping support department budgets its costs at $40 000 per month plus $12 per hour. The estimated and actual hours for November provided by the housekeeping support department to three operating departments are:

Required:
a. Calculate the support department's allocation rate if estimated hours is the allocation base.
b. Calculate the support department's allocation rate if actual hours is the allocation base.
c. Discuss one advantage and one disadvantage for each type of allocation rate.