Question
In: Accounting
Use the Direct Method to allocate Service Department Costs to the Operating Departments based on number...
-
Use the Direct Method to allocate Service Department Costs to the Operating Departments based on number (percentage) of employees.
Attacking Dept = 110 employees
Shark Dept = 135 employees
|
Service Dept. Maintenance |
Service Dept. Cafeteria |
Service Dept. Custodial |
Operating Dept. Painting |
Operating Dept. Welding |
|
|
Dept costs before allocation |
$200,000 |
110,000 |
275,000 |
500,000 |
850,000 |
|
Maintenance |
|||||
|
Cafeteria |
|||||
|
Custodial |
|||||
|
Total after allocation |
Solutions
Expert Solution
| Calculation of bases of allocation | |||||
| Painting dept | Operating dept | Total | |||
| 110 | 135 | 245 | |||
| % no. of employees | 45% | 55% | 100% | ||
| Allocation of costs | |||||
| Service dept | Operating dept | ||||
| Maintenance | Cafeteria | Custodial | Painting | Welding | |
| $ 200,000 | $ 110,000 | $ 275,000 | $ 500,000 | $ 850,000 | |
| Allocation of costs | |||||
| Maintenance | $ (200,000) | $ 89,796 | $ 110,204 | ||
| Cafeteria | $(110,000) | $ 49,388 | $ 60,612 | ||
| Custodial | $ (275,000) | $ 123,469 | $ 151,531 | ||
| Total after allocation | $ - | $ - | $ - | $ 762,653 | $1,172,347 |
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ekkarill92 answered 3 years agoRelated Solutions
Use the Direct Method to allocate Service Department Costs to the Operating Departments based on number...
Use the Direct Method to allocate Service Department Costs to
the Operating Departments based on number (percentage) of
employees.
Painting Dept = 110 employees
Welding Dept = 135 employees
Service Dept. Maintenance
Service Dept. Cafeteria
Service Dept. Custodial
Operating Dept. Painting
Operating Dept. Welding
Dept costs before allocation
$200,000
110,000
275,000
500,000
850,000
Maintenance
Cafeteria
Custodial
Total after allocation
Use the Step-Down Method to allocate Service Department costs to
the Operating Departments based on the number (percentage) of
employees.
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In order to allocate service departments' costs to production
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1)
Managers trace _____ to service departments. Managers allocate
______ to service departments.
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D) direct costs; producing department costs.
2)
The allocation of fixed costs in service departments to user
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A) actual capacity used in last period.
B) budgeted capacity available to user.
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D) actual usage by service development.
3)...
Looking to compare, thanks. A) Allocate the two support departments' costs to the two operating departments...
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A) Allocate the two support departments' costs to the two
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Direct Method
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Step -down method (Allocate IS first)
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AS
IS
GOVT
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Total
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45. The step method allocates
costs of service departments to
a.
other service departments.
b.
producing departments.
c.
joint products.
d.
other service departments and producing
departments.
46. What is the
firststep in allocating service department costs
to production departments?
a.
Assign overhead costs that are directly attributable to a
service or production department.
b.
Allocate other overhead costs based on appropriate cost
drivers.
c.
Allocate service department costs to production departments.
d.
None of the answers is correct.
Stephanie Company
Stephanie...
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The overhead costs of the Personnel Department allocated to
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Company has two service departments and two operating
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1. Looking to compare, thanks. A) Allocate the two support departments' costs to the two operating...
1.
Looking to compare, thanks.
A) Allocate the two support departments' costs to the two
operating departments using the following methods?
Direct Method
Step-down method (Allocate AS first)
Step -down method (Allocate IS first)
B) Compare and Explain differences in the support department
costs allocated to each operating department?
C) What approaches might be used to decide the sequence in which
to allocate support departments when using the step-down
method?
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AS
IS
GOVT
CORP
Total
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Personnel
Maintenance
Assembly
Machining
Departmental costs
$144,000
$84,000
$12,000
$34,000
Number of employees
35
30
90
60
Machine-hours
0
0
210
290
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