II. Cost allocation using Reciprocal MethodCheese Whiz Co, a Swiss manufacturer of cheese products, has two servicecenters and two producing departments. Data for month month of October are asfollows:Service CentersMaintenanceUtilitiesCost (Swiss francs)Service provided to:Maintenance66,00045,00010%Utilities20%40%40%Producing Dept. 1Producing Dept. 2Direct cost to producing departmentsDepartment 1 - Sf 280,00030%60%Department 2 - Sf 220,000Required: Using Reciprocal method, allocate the cost of service centers to producingdepartments and calculate ther total cost of the producing departments.

Under reciprocal service method, the cost of service departments are allocated between themselves…

II. Cost allocation using Reciprocal Method Cheese Whiz Co, a Swiss manufacturer of cheese products, has two service centers and two producing departments. Data for month month of October are as follows: Service Centers Maintenance Utilities Cost (Swiss francs) Service provided to: Maintenance Utilities 66,000 45,000 10% 20% 40% 40% Producing Dept. 1 Producing Dept. 2 Direct cost to producing departments Department 1 - Sf 280,000 30% 60% Department 2 - Sf 220,000 Required: Using Reciprocal method, allocate the cost of service centers to producing departments and calculate ther total cost of the producing departments.

II. Cost allocation using Reciprocal Method Cheese Whiz Co, a Swiss manufacturer of cheese products, has two service centers and two producing departments. Data for month month of October are as follows: Service Centers Maintenance Utilities Cost (Swiss francs) Service provided to: Maintenance Utilities 66,000 45,000 10% 20% 40% 40% Producing Dept. 1 Producing Dept. 2 Direct cost to producing departments Department 1 - Sf 280,000 30% 60% Department 2 - Sf 220,000 Required: Using Reciprocal method, allocate the cost of service centers to producing departments and calculate ther total cost of the producing departments.

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter12: Integer Linear Optimization_models

Section: Chapter Questions

Problem 6P: Hart Manufacturing makes three products. Each product requires manufacturing operations in three...

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Question V – Allocate Costs with Reciprocal Method (8 Marks) Anchor Company manufactures a variety of tool boxes. They have two operating divisions – Corporate Sales and Consumer Sales – and two support divisions –Admin and IT. Each operating division operates independently. Anchor uses the number of employees to allocate Admin costs and computer processing time to allocate IT costs. The following data are available for the month: SUPPORT DEPT OPERATING DEPT Admin IT Corp Sales Cons. Sales Budgeted costs before interdivision allocations $170,000 $400,000 $2,000,000 $1,000,000 Admin budgeted # of employees 40 80 70 IT budgeted # of processing time (in minutes) 600 4,000 3,400 REQUIRED: Using the reciprocal method, allocate the support department costs.
Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 13,600 16,500 $24 Assembly Labor hours 69,000 82,500 17 Expediting Orders expedited 0 5,500 57 Storing Number of units 0 11,000 8 Assume that at the beginning of 20x2, Cicleta trained the assembly workers in a new approach that had the objective of increasing the efficiency of the assembly process. Cicleta also began moving toward a JIT purchasing and manufacturing system. When JIT is fully implemented, the demand for expediting is expected to be virtually eliminated. It…
Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 20x1 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 12,000 18,000 $21 Assembly Labor hours 75,000 90,000 15 Expediting Orders expedited 0 6,000 50 Storing Number of units 0 12,000 7 Assume that at the beginning of 20x2, Cicleta trained the assembly workers in a new approach that had the objective of increasing the efficiency of the assembly process. Cicleta also began moving toward a JIT purchasing and manufacturing system. When JIT is fully implemented, the demand for expediting is expected to be virtually eliminated. It…
Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of August follow: Proportion of Services Used by Department Direct Costs Maintenance Cafeteria Machining Assembly Machining $130,000 Assembly 75,000 Maintenance 46,000 — 0.2 0.6 0.2 Cafeteria 42,000 0.7 — 0.2 0.1 Required: Use the reciprocal method to allocate the service costs. (Matrix algebra is not required.) (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts.) Cost Allocation To FROM Maintenance Cafeteria Machining Assembly service dept. cost Maintenance Cafeteria TOTAL
Direct, sequential, and reciprocal allocationMing Company has two service departments (S1 and S2) and two production departments (P1 and P2). Last year, directly identified overhead costs were $255,000 for S1 and $320,000 for S2.Information on the consumption of their services follows: Supplying User Departments Departments S1 S2 P1 P2 S1 500 1,200 6,000 1,300 S2 800 200 7,000 9,000 (a) Determine the service department costs allocated to the two production departments using the direct method.Note: Round each rate to two decimal places before calculating the allocated amounts. Round answers to the nearest dollar. Rate Total (rounded to 2 decimals) Total P1 Total P2 (any diff due to rounding) S1 allocation amount Answer Answer Answer S1 allocation amount Answer Answer Answer Total service department costs Answer Answer Answer (b) Determine the service department costs allocated to the two production departments using the…
Value- and Non-Value-Added Cost Reporting Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 2014 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 10,400 28,500 $18 Assembly Labor hours 117,000 142,500 13 Expediting Orders expedited 0 9,500 43 Storing Number of units 0 19,000 6 Required: 1. Prepare a cost report for the year ending 2014 that shows value-added costs, non-value-added costs, and total costs for each activity. If an amount is zero, enter "0". Cicleta Manufacturing Value and Non-Value-Added Cost Report For the Year Ended 2014 Activity Value-Added…
Value- and Non-Value-Added Cost Reporting Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 2014 (actual price per unit of the activity driver is assumed to be equal to the standard price): Activity Activity Driver SQ AQ SP Receiving Receiving orders 13,600 27,000 $24 Assembly Labor hours 111,000 135,000 17 Expediting Orders expedited 0 9,000 57 Storing Number of units 0 18,000 8 Required: 1. Prepare a cost report for the year ending 2014 that shows value-added costs, non-value-added costs, and total costs for each activity. If an amount is zero, enter "0". Cicleta Manufacturing Value and Non-Value-Added Cost Report For the Year Ended 2014 Activity Value-Added…
Activity and selected costs for three production departments (Training, Independent, and Commercial) and two service departments (Accounting and Facilities) at DuBay Films for the past month follow: Supplying Department Using Department Accounting Facilities Training Independent Commercial Accounting 0 0.50 0.20 0.10 0.20 Facilities 0.20 0 0.20 0.20 0.40 Direct cost $ 110,000 $ 144,500 $ 250,000 $ 193,000 $ 279,000 Required: Allocate service department costs to Training, Independent, and Commercial using the reciprocal method. What are the total costs of Training, Independent, and Commercial after this allocation? Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts.
Allocating Selling and Administrative Expenses using Activity-Based CostingShrute Inc. manufactures office copiers, which are sold to retailers. The price and cost of goods sold for each copier are as follows: Price$1,110per unitCost of goods sold682 Gross profit$428per unit In addition, the company incurs selling and administrative expenses of $414,030. The company wishes to assign these costs to its three major retail customers, The Warehouse, Kosmo Co., and Supply Universe. These expenses are related to its three major nonmanufacturing activities: customer service, sales order processing, and advertising support. The advertising support is in the form of advertisements that are placed by Shrute Inc. to support the retailer's sale of Shrute copiers to consumers. The budgeted activity costs and activity bases associated with these activities are: ActivityBudgeted Activity Cost Activity BaseCustomer service$76,860Number of service requestsSales order processing25,920Number of sales…
Mack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair and Quality Control. Direct costs for each department and the proportion of service costs used by the various departments for the month of March follow: Department Proportion of Services Used by Direct Costs Repair Quality Control Fabricating Finishing Fabricating $ 1,40,600 Finishing $ 98,200 Repair $ 42,000 0 0.3 0.4 0.3 Quality Control $ 78,400 0.3 0 0.2 0.5 Required: Use the reciprocal method to allocate the service costs. (Matrix algebra is not required.) Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations
Use the following information for the Exercise below. (Algo) Skip to question [The following information applies to the questions displayed below.]Barnes Company reports the following for its product for its first year of operations. Direct materials $ 34 per unit Direct labor $ 24 per unit Variable overhead $ 12 per unit Fixed overhead $ 54,000 per year Variable selling and administrative expenses $ 2 per unit Fixed selling and administrative expenses $ 26,000 per year Exercise 19-4 (Algo) Computing cost per unit at different production levels LO P1, P2 P1. Compute total product cost per unit using absorption costing for the following production levels: (a) 3,000 units, (b) 3,600 units, and (c) 4,500 units. P2. The company sells its product for $140 per unit. Compute contribution margin using variable costing assuming the company (a) produces and sells 3,000 units and (b) produces 3,600 units and sells 3,000 units.
Problem 1. Mahinahon Company would like to institute an activity-based costing system to price products. The company's Purchasing Department incurs costs of P550,000 per year and has six employees. Purchasing has determined the three major activities that occur during the year. Activity Allocation Measure # of People Total Cost Issuing purchase orders # of purchase orders 1 P285,000 Reviewing receiving reports # of receiving reports 2 P190,000 Making phone calls # of phone calls 3 P220,000 During the year, 50,000 phone calls were made in the department; 15,000 purchase orders were issued; and 10,000 shipments were received. Product A required 200 phone calls, 150 receiving reports, and 50 purchase orders. Product B required 350 phone calls, 400 receiving reports, and 100 purchase orders. 1Determine the amount of purchasing department cost that should be assigned to each of these products. 1.2. Determine purchasing department cost per…