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Required information SB Exercise 4B-3 through Exercise 4B-4 (Algo) The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs Number of employees Square feet of space occupied Hours of press time Service Departments Administration Janitorial Maintenance $ 162,400 $ 55,680 140 20,000 $ 121,800 60 15,000 35 10,000 Operating Departments Binding $ 319,000 315 40,000 30,000 Printing $ 498,800 210 100,000 60,000 Total $ 1,157,680 760 185,000 90,000 Exercise 4B-3 (Algo) Step-Down Method [LO4-11] The company allocates service department costs by the step-down method in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time). Required: Using the step-down method, allocate the service department costs to the operating departments. (Please enter allocations from department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.)

Required information SB Exercise 4B-3 through Exercise 4B-4 (Algo) The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs Number of employees Square feet of space occupied Hours of press time Service Departments Administration Janitorial Maintenance $ 162,400 $ 55,680 140 20,000 $ 121,800 60 15,000 35 10,000 Operating Departments Binding $ 319,000 315 40,000 30,000 Printing $ 498,800 210 100,000 60,000 Total $ 1,157,680 760 185,000 90,000 Exercise 4B-3 (Algo) Step-Down Method [LO4-11] The company allocates service department costs by the step-down method in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time). Required: Using the step-down method, allocate the service department costs to the operating departments. (Please enter allocations from department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.)

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 4CE: Refer to Cornerstone Exercise 7.3. Now assume that Valron Company uses the sequential method to...
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Required information SB Exercise 4B-3 through Exercise 4B-4 (Algo) The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs Number of employees Square feet of space occupied Hours of press time Service Departments Administration Janitorial Maintenance $ 162,400 $ 121,800 $ 55,680 140 20,000 Departmental costs before allocations Allocations: 60 15,000 Administration costs Janitorial costs Maintenance costs Total costs after allocations 35 10,000 Exercise 4B-3 (Algo) Step-Down Method [LO4-11] The company allocates service department costs by the step-down method in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time). Service Departments Administration Janitorial $ 162,400 $ 121,800 $ $ 162,400 $ Required: Using the step-down method, allocate the service department costs to the operating departments. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.) Maintenance 121,800 $ Operating Departments Binding $ 319,000 315 40,000 30,000 55,680 $ 55,680 $ Printing $ 498,800 210 100,000 60,000 Operating Departments Binding Printing 319,000 $ 498,800 $ 319,000 $ Total $ 1,157,680 498,800 Total 760 185,000 90,000 1,157,680 $ 1,157,680
Transcribed Image Text:Required information SB Exercise 4B-3 through Exercise 4B-4 (Algo) The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Costs Number of employees Square feet of space occupied Hours of press time Service Departments Administration Janitorial Maintenance $ 162,400 $ 121,800 $ 55,680 140 20,000 Departmental costs before allocations Allocations: 60 15,000 Administration costs Janitorial costs Maintenance costs Total costs after allocations 35 10,000 Exercise 4B-3 (Algo) Step-Down Method [LO4-11] The company allocates service department costs by the step-down method in the following order: Administration (number of employees), Janitorial (space occupied), and Maintenance (hours of press time). Service Departments Administration Janitorial $ 162,400 $ 121,800 $ $ 162,400 $ Required: Using the step-down method, allocate the service department costs to the operating departments. (Please enter allocations from a department as negative and allocations to a department as positive. The line should add across to zero. Do not round intermediate calculations.) Maintenance 121,800 $ Operating Departments Binding $ 319,000 315 40,000 30,000 55,680 $ 55,680 $ Printing $ 498,800 210 100,000 60,000 Operating Departments Binding Printing 319,000 $ 498,800 $ 319,000 $ Total $ 1,157,680 498,800 Total 760 185,000 90,000 1,157,680 $ 1,157,680
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