Watts Corporation has a Custodial Services Department that services the company's Maintenance Department and its two operating departments. Costs of the Custodial Services Department are allocated to other departments on the basis of square feet of space occupied. The amount of space occupied by each department is given below: Custodial Services4,000square feetMaintenance6,000square feetOperating Department 130,000square feetOperating Department 260,000square feet? ?Budgeted costs in the Custodial Services Department total $43,200.? ?Suppose the company uses the step-down method of allocation and the costs of the Custodial Services Department are allocated first. The amount of Custodial Services Department cost allocated to the Maintenance Department would be:
A. $2,592
B. $0
C. $2,700
D. $2,880
Answer: C
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