Fundamentals Of Cost Accounting (6th Edition)
6th Edition
ISBN: 9781259969478
Author: WILLIAM LANEN, Shannon Anderson, Michael Maher
Publisher: McGraw Hill Education
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Chapter 11, Problem 16CADQ
To determine
Define the reasons behind giving preference to the reciprocal method.
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Students have asked these similar questions
Which service department cost allocation method provides for reciprocal allocation of service costs among the service department as well as to the revenue producing departments?
a. Method of Algebra
b. Step method
c. Indirect method
d. direct method
e. None of the above
Which of the following methods recognizes some (but not all) of the services that occur between service departments?
Indirect method.
Step-down method.
Reciprocal-services method.
Dual-cost allocation method.
Direct method.
The only method of allocation of service department costs to producing departments that considers reciprocal services is called the
a. Step method
b. Direct method
c. none of the choices
d. Algebraic method
Chapter 11 Solutions
Fundamentals Of Cost Accounting (6th Edition)
Ch. 11 - Why do companies allocate costs? What are some of...Ch. 11 - What are the three methods of allocating service...Ch. 11 - What are the similarities and differences among...Ch. 11 - What criterion should be used to determine the...Ch. 11 - What is a limitation of the direct method of...Ch. 11 - What is a limitation of the step method of...Ch. 11 - Prob. 7RQCh. 11 - Why would a number of accountants express a...Ch. 11 - Prob. 9RQCh. 11 - What is the basic difference between the...
Ch. 11 - Prob. 11RQCh. 11 - If cost allocations arc arbitrary and potentially...Ch. 11 - Prob. 13CADQCh. 11 - Prob. 14CADQCh. 11 - Prob. 15CADQCh. 11 - Prob. 16CADQCh. 11 - Prob. 17CADQCh. 11 - Prob. 18CADQCh. 11 - What are some of the factors that a company needs...Ch. 11 - Prob. 20CADQCh. 11 - Prob. 21CADQCh. 11 - Prob. 22CADQCh. 11 - How is joint cost allocation like service...Ch. 11 - Prob. 24CADQCh. 11 - In what ways is joint cost allocation similar to...Ch. 11 - Why Are Costs Allocated?Ethical Issues You are the...Ch. 11 - Cost Allocation: Direct Method Caro Manufacturing...Ch. 11 - Allocating Service Department Costs First to...Ch. 11 - Cost Allwat ion: Direct Method University Printers...Ch. 11 - Prob. 30ECh. 11 - Cost Allocation: Step Method
Refer to the data for...Ch. 11 - Cost Allocation: Reciprocal Method
Refer to the...Ch. 11 - Cost Allocation: Reciprocal Method, Two Service...Ch. 11 - Cost Allocation: Reciprocal Method
Refer to the...Ch. 11 - Prob. 35ECh. 11 - Prob. 36ECh. 11 - Prob. 37ECh. 11 - Prob. 38ECh. 11 - Prob. 39ECh. 11 - Prob. 40ECh. 11 - Net Realizable Value Method: Multiple Choice
Oak...Ch. 11 - Sell or Process Further: Multiple Choice
Refer to...Ch. 11 - Net Realizable Value Method Euclid Corporation...Ch. 11 - Estimated Net Realizable Value Method Blasto,...Ch. 11 - Net Realizable Value Method to Solve for Unknowns...Ch. 11 - Net Realizable Value Method Bixel Components...Ch. 11 - Net Realizable Value Method with By-Products...Ch. 11 - Net Realizable Value Method Deming Sons...Ch. 11 - Physical Quantities Method
Refer to the facts in...Ch. 11 - Sell or Process Further
Refer to the facts in...Ch. 11 - Physical Quantities Method The following questions...Ch. 11 - Physical Quantities Method; Sell or Process...Ch. 11 - Physical Quantities Method with By-Product...Ch. 11 - Step Method with Three Service Departments Model,...Ch. 11 - Comparison of Allocation Methods BluStar Company...Ch. 11 - Solve for Unknowns: Direct Method Franks Foods has...Ch. 11 - Solve for Unknowns: Step Method RT Renovations is...Ch. 11 - Cost Allocation: Step Method with Analysis and...Ch. 11 - Prob. 59PCh. 11 - Prob. 60PCh. 11 - Direct, Step, and Reciprocal Methods:...Ch. 11 - Cost Allocation: Step and Reciprocal Methods...Ch. 11 - Allocate Service Department Costs: Direct and Step...Ch. 11 - Prob. 64PCh. 11 - Prob. 65PCh. 11 - Prob. 66PCh. 11 - Prob. 67PCh. 11 - Prob. 68PCh. 11 - Fletcher Fabrication, Inc., produces three...Ch. 11 - Findina Missing Data: Net Realizable Value Spartan...Ch. 11 - Finding Missing Data: Net Realizable Value Blaine,...Ch. 11 - Joint Costing in a Process Costing Context:...Ch. 11 - Find Maximum Input Price: Estimated Net Realizable...Ch. 11 - Effect of By-Product versus Joint Cost Accounting...Ch. 11 - Prob. 75PCh. 11 - Prob. 76P
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- Are large or small companies more likely to use the reciprocal services method to allocate support department costs production department? Why?arrow_forwardWhen using the sequential distribution method of distributing service department costs, if each of two service departments services the same number of other departments, how is it determined as to which service department to allocate first?arrow_forwardWhich method of allocating support department costs is completed by taking the service flows to production departments only and determining each production department's share of that service? Question options: a) average method. b) step method. c) direct method. d) reciprocal method.arrow_forward
- Explain briefly the main differences between the direct, step-down, and reciprocal-services methods of service department cost allocation.arrow_forwardWhat is conceptually the most defensible method for allocating support-department costs? Why?arrow_forwardsupport department cost allocation- reciprocal services methodarrow_forward
- Which method would you recommend that Ballantine Corporation use to allocate service-department costs? Why?arrow_forwardDetermining the basis used to allocate support department costs follows which guideline? O Profit maximization O Revenue generation O Goal comparison O Cause and effectarrow_forwardReciprocal Method of Support Department Cost Allocation. Please answer in same format as question, thanks.arrow_forward
- What is one key way to reduce cost-allocation disputes that arise with government contracts?arrow_forwardAllocate the two support departments’ costs to the two operating departments using the following methods: The Algebraic/reciprocal method?arrow_forwardSuggest a reasonable basis for allocating thefollowing indirect expenses to departments: advertisingarrow_forward
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