Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: Budgeted manufacturing overhead costs: M (Support Dept) P (Support Dept) W (Weaving Dept) C (Colorizing Dept) Maintenance Personnel Weaving Colorizing Services furnished By Maintenance (budgeted labor-hours): to Personnel to Weaving to Colorizing By Personnel (Number of employees serviced): Plant Maintenance Weaving Colorizing Which of the following linear equations represents the complete reciprocated cost of the Personnel Department? A. P = $200,000 B. P = (1,100/13,700) M C. P= $200,000+ (1,100/ 13,700) M D. P= $330,000 $200,000 (1,100/13,700) M $330,000 $200,000 $660,000 $440,000 1,100 7,600 5,000 9 39 25

Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: Budgeted manufacturing overhead costs: M (Support Dept) P (Support Dept) W (Weaving Dept) C (Colorizing Dept) Maintenance Personnel Weaving Colorizing Services furnished By Maintenance (budgeted labor-hours): to Personnel to Weaving to Colorizing By Personnel (Number of employees serviced): Plant Maintenance Weaving Colorizing Which of the following linear equations represents the complete reciprocated cost of the Personnel Department? A. P = $200,000 B. P = (1,100/13,700) M C. P= $200,000+ (1,100/ 13,700) M D. P= $330,000 $200,000 (1,100/13,700) M $330,000 $200,000 $660,000 $440,000 1,100 7,600 5,000 9 39 25

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 19E

See similar textbooks

Similar questions

A manufacturing company has two service and two production departments. Human Resources and Machine Repair are the service departments. The production departments are Grinding and Polishing. The following data have been estimated for next years operations: The direct charges identified with each of the departments are as follows: The human resources department services all departments of the company, and its costs are allocated using the numbers of employees within each department, while machine repair costs are allocable to Grinding and Polishing on the basis of machine hours. 1. Distribute the service department costs, using the direct method. 2. Distribute the service department costs, using the sequential distribution method, with the department servicing the greatest number of other departments distributed first.
Rex Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity.
A manufacturing company has two service and two production departments. Building Maintenance and Factory Office are the service departments. The production departments are Assembly and Machining. The following data have been estimated for next years operations: The direct charges identified with each of the departments are as follows: The building maintenance department services all departments of the company, and its costs are allocated using floor space occupied, while factory office costs are allocable to Assembly and Machining on the basis of direct labor hours. 1. Distribute the service department costs, using the direct method. 2. Distribute the service department costs, using the sequential distribution method, with the department servicing the greatest number of other departments distributed first.
Rocks Industries has identified three different activities as cost drivers: machine setups, machine hours, and inspections. The overhead and estimated usage are: Compute the overhead rate for each activity.
Freeman Furnishings has summarized its data as shown. Direct labor hours will be used as the activity base to allocate overhead: Compute the cost of goods manufactured.
Freeman Furnishings has summarized its data as shown: Compute the cost of goods manufactured, assuming that the overhead is allocated based on direct labor hours
Carltons Kitchens three cost pools and overhead estimates are as follows: Compare the overhead allocation using: A. The traditional allocation method B. The activity-based costing method (Hint: the traditional method uses machine hours as the allocation base.)
Cynthia Rogers, the cost accountant for Sanford Manufacturing, is preparing a management report that must include an allocation of overhead. The budgeted overhead for each department and the data for one job are as follows: Using the departmental overhead application rates, and allocating overhead on the basis of direct labor hours, overhead applied to Job 231 in the Tooling Department would be: a. 44.00. b. 197.50. c. 241.50. d. 501.00.
Eisenhower Services, Inc., a management consulting firm, has been using a single predetermined overhead allocation rate with direct labor hours as the allocation pase to allocate overhead costs. The president of Eisenhower decided to develop an ABC system to more accurately allocate the indirect costs. She identified two activities related to the total indirect costs-travel and information technology (IT) support. The other relevant details are given below: Estimated quantity of allocation base Activity Allocation base Estimated costs 1,800 miles 7,400 DLH. Travel $10,000 72,000 $82,000 Miles driven IT Support Direct labor hours Total During the current month, Eisenhower's consultants spent 240 labor hours for Miller, Inc. The job required the professionals to travel 360 miles in total. Direct Labor i billed at $55 per hour. Determine the total cost of the consulting job using the ABC system. (Round any intermediate calculations to the nearest cent and your final answer to thé nearest…
INWON PETERNULFINN Alfred owner of Hi-Tech Fiberglass Fabricators, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: ← Budgeted manufacturing overhead costs: Plant Maintenance Data Processing Machining Capping PM (Support Dept) DP (Support Dept) M (Operating Dept) C (Operating Dept) Services furnished. By Plant Maintenance (budgeted labor-hours); to Data Processing to Machining to Capping By Data Processing (budgeted computer time): to Plant Maintenance to Machining to Capping What is the complete reciprocated cost of the Data Processing Department? (Do not round any intermediary calculations.) OA. $117,316 OB. $60,415 OC. $260,000 OD. $86.227 GIED $310.000 $50,000 $245.000 $130,000 3,500 5,300 8.000 600 4,100 650
I need help with the following: Support department cost allocation—reciprocal services method Davis Snowflake & Co. produces Christmas stockings in its Cutting and Sewing departments. The Maintenance and Security departments support the production of the stockings. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table: MaintenanceDepartment SecurityDepartment CuttingDepartment SewingDepartment Machine hours 800 2,000 6,400 11,600 Asset value $2,000 $1,420 $1,500 $6,500 Department cost $36,720 $16,320 $64,000 $84,000 Determine the total cost of each production department after allocating all support department costs to the production departments using the reciprocal services method. CuttingDepartment SewingDepartment…
Alfred, owner of Hi-Tech Fiberglass Fabricators, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: Budgeted manufacturing overhead costs: Plant Maintenance Data Processing Machining Capping PM (Support Dept) DP (Support Dept) M (Operating Dept) C (Operating Dept) Services furnished: By Plant Maintenance (budgeted labor - hours): to Data Processing to Machining to Capping By Data Processing (budgeted computer time): to Plant Maintenance to Machining to Capping What is the complete reciprocated cost of the Plant Maintenance OA. $420,000 B. $344,026 OC. $349,666 OD. $353,590 $320,000 $100,000 $245,000 $145,000 3,400 5,800 8,000 800 4,050 750 (Do not round any intermediary calculations.)