Single-rate method, budgeted versus actual costs and quantities. Chocolat Inc. is a producer of premium chocolate based in Palo Alto. The company has a separate division for each of its two products: dark chocolate and milk chocolate. Chocolat purchases ingredients from Wisconsin for its dark chocolate division and from Louisiana for its milk chocolate division. Both locations are the same distance from Chocolat's Palo Alto plant. Chocolat Inc. operates a fleet of trucks as a cost center that charges the divisions for variable costs (driv- ers and fuel) and fixed costs (vehicle depreciation, insurance, and registration fees) of operating the fleet. Each division is evaluated on the basis of its operating income. For 2017, the trucking fleet had a practical capacity of 50 round-trips between the Palo Alto plant and the two suppliers. It recorded the following information: Home Insert Page Layout Formulas Data Review View A. B Budgeted $115,000 Actual 2 Costs of truck fleet Number of round-trips for dark chocolate 3 division (Palo Alto plant-Wisconsin) Number of round-trips for milk chocolate 4 division (Palo Alto plant-Louisiana) $96,750 30 30 20 15
Single-rate method, budgeted versus actual costs and quantities. Chocolat Inc. is a producer of premium chocolate based in Palo Alto. The company has a separate division for each of its two products: dark chocolate and milk chocolate. Chocolat purchases ingredients from Wisconsin for its dark chocolate division and from Louisiana for its milk chocolate division. Both locations are the same distance from Chocolat's Palo Alto plant. Chocolat Inc. operates a fleet of trucks as a cost center that charges the divisions for variable costs (driv- ers and fuel) and fixed costs (vehicle depreciation, insurance, and registration fees) of operating the fleet. Each division is evaluated on the basis of its operating income. For 2017, the trucking fleet had a practical capacity of 50 round-trips between the Palo Alto plant and the two suppliers. It recorded the following information: Home Insert Page Layout Formulas Data Review View A. B Budgeted $115,000 Actual 2 Costs of truck fleet Number of round-trips for dark chocolate 3 division (Palo Alto plant-Wisconsin) Number of round-trips for milk chocolate 4 division (Palo Alto plant-Louisiana) $96,750 30 30 20 15
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter9: Profit Planning And Flexible Budgets
Section: Chapter Questions
Problem 68P: Use the following information for Problems 9-67 through 9-69: Ladan Suriman, controller for Healthy...
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Using the single-rate method, allocate costs to the dark chocolate division and the milk chocolate division ,Calculate the actual rate per round-trip and allocate costs based on actual round-trips used by each division.
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