Distribution of Direct and Indirect Overhead Costs to Producing Departments. Ming Chemical Co. operates with three producing departments—Blending, Testing, and Terminal. The overhead items and amounts for the period, along with the bases for their allocation, are listed below. How much is the Janitorial Cost to be charged to Blending Department? 2. How much is the Indirect Labor to be chared to Testing Department?

Managerial Accounting
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ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
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Chapter3: Process Cost Systems
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Distribution of Direct and Indirect Overhead Costs to Producing Departments. Ming Chemical Co. operates with three producing departments—Blending, Testing, and Terminal. The overhead items and amounts for the period, along with the bases for their allocation, are listed below. How much is the Janitorial Cost to be charged to Blending Department?

2. How much is the Indirect Labor to be chared to Testing Department?

 

Item
Amount
Allocation Basis
P 24,000 Square footage
Building depreciation..
Janitorial cost .
33,000 Square footage
Materials receiving cost..
48,000 Materials usage
Payroll Department cost.
126,000 Number of employees
Power....
75,000 Horsepower of equipment
Other relevant data are:
Blending
Testing
Terminal
Total
Department
Department
Department
Number of employees
25
40
19
84
Direct labor hours
62,000
104,000
220,000
54,000
5,000
Horsepower of
equipment
Kilowatt-hours
60,000
15,000
80,000
4,000
1,000
6,000
11,000
Square footage
Directly chargeable
2,000
2,000
2,000
6,000
P125,000
P75,000
P87,500
P287,500
overhead cost
Direct materials
P 75,000
P25,000
P100,000
Transcribed Image Text:Item Amount Allocation Basis P 24,000 Square footage Building depreciation.. Janitorial cost . 33,000 Square footage Materials receiving cost.. 48,000 Materials usage Payroll Department cost. 126,000 Number of employees Power.... 75,000 Horsepower of equipment Other relevant data are: Blending Testing Terminal Total Department Department Department Number of employees 25 40 19 84 Direct labor hours 62,000 104,000 220,000 54,000 5,000 Horsepower of equipment Kilowatt-hours 60,000 15,000 80,000 4,000 1,000 6,000 11,000 Square footage Directly chargeable 2,000 2,000 2,000 6,000 P125,000 P75,000 P87,500 P287,500 overhead cost Direct materials P 75,000 P25,000 P100,000
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