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Manufacturing Overhead Distribution Worksheet The following are selected operating data for the production and service departments...

Manufacturing Overhead Distribution Worksheet

The following are selected operating data for the production and service departments of Bluestone Company for 2016.

Departments
Service Production
1 2 1 2
Overhead costs (identified by department)
Indirect material $121,000 $205,500 $63,600 $1,290,000
Indirect labor $243,000 $360,000 $81,460 $3,597,500
Square feet of building floor space used 12,000 18,000 30,000 60,000
Assessed value of equipment used $52,500 $157,500 $315,000 $525,000
Cubic yards of factory space used 220,000 330,000
Machine hours 128,000 512,000
Direct labor $50,000 $1,000,000

Building depreciation of $240,000 is allocated on the basis of square feet of floor space. Personal property taxes of $90,000 are allocated on the basis of assessed values of equipment used. Costs for service departments 1 and 2 are allocated to production departments on the basis of cubic yards of factory space and machine hours, respectively.

Required

a. Prepare a 2016 overhead distribution worksheet for Bluestone Company similar to the one prepared for Exhibit 3-15.

Use negative signs with answers, when appropriate. Under the Allocation Basis column, select the basis used to calculate each allocation.

Solutions

Expert Solution

Bluestone Company
Overhead Distribution Worsksheet
For the Year Ended December 31, 2016
Service departments Production departments Allocation basis
1 2 1 2
Directly identifiable with departments:
Indirect material 121000 205500 63600 1290000
Indirect labor 243000 360000 81460 3597500
Allocated to departments:
Building depreciation 24000 36000 60000 120000 Square feet of building floor space used
($ 240000 at 12000:18000:30000:60000 or 2:3:5:10) 240000*(2/20) 240000*(3/20) 240000*(5/20) 240000*(10/20)
Personal property taxes 4500 13500 27000 45000 Assessed value of equipment used
($ 90000 at 52500:157500:315000:525000 or 1:3:6:10) 90000*(1/20) 90000*(3/20) 90000*(6/20) 90000*(10/20)
Total overhead 392500 615000 232060 5052500
Allocation of service departments:
Dept. 1 ($392500 at 220000:330000 or 2:3) -392500 0 157000 235500 Cubic yards of factory space used
392500*(2/5) 392500*(3/5)
Dept. 2 ($615000 at 128000:512000 or 1:4) 0 -615000 123000 492000
615000*(1/5) 615000*(4/5)
Total allocated overhead 0 0 512060 5780000

ekkarill92 answered 1 year ago
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