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Lena [83]
4 years ago
11

Ready Company has two operating (production) departments: Assembly and Painting. Assembly has 160 employees and occupies 45,000

square feet; Painting has 110 employees and occupies 30,000 square feet. Indirect factory expenses for the current period are as follows: Administration $ 81,000 Maintenance $ 110,000 Administration is allocated based on workers in each department; maintenance is allocated based on square footage. The total amount of indirect factory expenses that should be allocated to the Assembly Department for the current period is (Do not round your intermediate calculations):
Business
1 answer:
Xelga [282]4 years ago
4 0

Answer:

The total amount of overheads allocated to Assembly Department are $114000

Explanation:

We first calculate the overhead absorption rate for the two departments based on their respective overheads.

<u>Overhead Absorption Rate (OAR)</u>

Administration OAR = 81000 / (160+110) = $300 per employee

Maintenance OAR = 110000 / (45000+30000) = 1.466666667 per sq. feet

The total overheads that should be allocated to assembly department will be:

Total overheads-Assembly = 300 * 160 + 1.466666667 * 45000 = $114000

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3 years ago
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Airida [17]

Answer:

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7 0
3 years ago
What would be the effect on the accounts if the business purchased equipment on account?
Serjik [45]

Answer:

A. An asset would be debited and a Liability credited.

Explanation:

Purchasing on account means buying on credit. The debts of the business increase. As a result,  liabilities increase.

Equipment is a business asset. Purchasing equipment increases assets.

In the double-entry accounting system, An increase in an asset is recorded by debiting the asset account. An increase in liabilities is captured by crediting the liabilities account.

3 0
4 years ago
A company borrows $70,000 by signing a $70,000, 8%, 6-year note that requires equal payments of $15,142 at the end of each year.
VLD [36.1K]

Answer:

$9,542

Explanation:

A loan is amortized by the equal annual payment, each payment is sum of the two payment made against the principal and interest for the period on due balance.

The Equal Payment of $15,142 includes the payment of interest for the period and Principal.

The Principal Payment is the net of Payment made and Interest expenses in the period.

Principal portion = $15,142 - $5,600 = $9,542

The principal will be reduced by $9,542.

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3 years ago
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