Yu.17. As the managing partner of Bramble Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's threedifferent business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three supportdepartments: Billing, Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along witheach department's usage of those services and its own original costs, are as follows.Original costBilling hours usedNumber of employeesIT hours usedSupport DepartmentsBilling$71,0002100HR$116,0002200IT$94,0001200AuditOperating Divisions$538,000 $800,0002,00012Tax9001,40015600Advisory$319,0006003300Totals$1,938,0004,000352,300 Rank the three support departments based on the percentage of their service provided to other support departments, and thenallocate their costs using the step method. (Round intermediate calculations to 4 decimal places, e.g. 15.2516 and final answers to 2decimal places, e.g. 15.25.)TotalAuditLATaxtA$AdvisorytATotal

Step Method refers to the method used for allocating the cost of service departments to various…

As the managing partner of Bramble Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's three different business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three support departments: Billing, Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along with each department's usage of those services and its own original costs, are as follows. Original cost Billing hours used Support Departments Billing $71,000 HR $116,000 IT $94,000 Operating Divisions Audit Advisory $538,000 $800,000 $319,000 2.000 Tax 1.400 600 Totals $1,938,000 4.000

As the managing partner of Bramble Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's three different business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three support departments: Billing, Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along with each department's usage of those services and its own original costs, are as follows. Original cost Billing hours used Support Departments Billing $71,000 HR $116,000 IT $94,000 Operating Divisions Audit Advisory $538,000 $800,000 $319,000 2.000 Tax 1.400 600 Totals $1,938,000 4.000

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter4: Accounting For Factory Overhead

Section: Chapter Questions

Problem 9E: A manufacturing company has two service and two production departments. Human Resources and Machine...

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