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Using the direct method, compute for the factory overhead rate of the D department if it apply overhead based on direct labor hours and budgeted direct labor hours for the period total to 75,000 hours. Sylvie Corporation has three production departments: K, D, and C. It also has two service departments Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on number of employees. Assume that Administration provides more service to the other departments than does the Personnel Department. Department Administration Direct Costs Employees Asset Value 900,000 1,200,000 600,000 300,000 1,600,000 1,800,000 700,000 1,400,000 400,000 50 20 Personnel K 30 D 10 500,000 20

Using the direct method, compute for the factory overhead rate of the D department if it apply overhead based on direct labor hours and budgeted direct labor hours for the period total to 75,000 hours. Sylvie Corporation has three production departments: K, D, and C. It also has two service departments Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on number of employees. Assume that Administration provides more service to the other departments than does the Personnel Department. Department Administration Direct Costs Employees Asset Value 900,000 1,200,000 600,000 300,000 1,600,000 1,800,000 700,000 1,400,000 400,000 50 20 Personnel K 30 D 10 500,000 20

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 28E: Minor Co. has a job order cost system and applies overhead based on departmental rates. Service...
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Using the direct method, compute for the factory overhead rate of the D department if it apply overhead based on direct labor hours and budgeted direct labor hours for the period total to 75,000 hours. Sylvie Corporation has three production departments: K, D. and C. It also has two service departments: Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on mumber of employees. Assume that Administration provides more service to the other departments than does the Personnel Department. Department Administration Direct Costs Employees Asset Value 50 20 1,800,000 700,000 1,400,000 400,000 500,000 900,000 1,200,000 600,000 300,000 1,600,000 Personnel 30 10 K D. C. 20
Transcribed Image Text:Using the direct method, compute for the factory overhead rate of the D department if it apply overhead based on direct labor hours and budgeted direct labor hours for the period total to 75,000 hours. Sylvie Corporation has three production departments: K, D. and C. It also has two service departments: Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on mumber of employees. Assume that Administration provides more service to the other departments than does the Personnel Department. Department Administration Direct Costs Employees Asset Value 50 20 1,800,000 700,000 1,400,000 400,000 500,000 900,000 1,200,000 600,000 300,000 1,600,000 Personnel 30 10 K D. C. 20
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