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umka2103 [35]
3 years ago
6

Support department cost allocation—direct method Becker Tabletops has two support departments (Janitorial and Cafeteria) and two

production departments (Cutting and Assembly). Relevant details for these departments are as follows: Support Department Cost Driver Janitorial Department Square footage to be serviced Cafeteria Department Number of employees Janitorial Department Cafeteria Department Cutting Department Assembly Department Department costs $320,000 $170,000 $1,490,000 $670,000 Square feet 40 5,000 600 2,400 Number of employees 8 3 36 4 Allocate the support department costs to the production departments using the direct method.
Business
1 answer:
OLEGan [10]3 years ago
8 0

Answer:

Using the direct method, total cost allocated to Cutting Department is $211,333 while total cost allocated to Assembly Department is $278,667.

Explanation:

Step 1: Calculation of the allocation of costs from Janitorial Department to Cutting and Assembly Departments

For Janitorial Department, square meter is used as the relevant basis of allocation and the following formula will be used:

Cost allocated to a Department = (Department’s Square meter ÷ Total Square meter) × Total cost of the Department being allocated

Therefore,

Janitorial Department Cost allocated to Cutting Department = (26 ÷ 30) × $170,000 = $64,000

Janitorial Department Cost allocated to Assembly Department = (4 ÷ 30) × $170,000 = $256,000

Step 2: Calculation of the allocation of costs from Cafeteria Department to Cutting and Assembly Departments

For Cafeteria Department, number of employee is used as the relevant basis of allocation and the following formula will be used:

Cost allocated to a Department = (Department’s number of employees ÷ Total Square meter) × Total cost of the Department being allocated

Therefore,

Cafeteria Department Cost allocated to Cutting Department = (600 ÷ 3,000) × $320,000 = $147,333  

Cafeteria Department Cost allocated to Assembly Department = (2,400 ÷ 3,000) × $320,000 = $22,667

Step 3: Calculation of Total Cost Allocated to each department

Total cost allocated to Cutting Department = $64,000 + $147,333 = $211,333

Total cost allocated to Assembly Department = $256,000 + $22,667 = $278,667

Conclusion

Therefore, using the direct method, total cost allocated to Cutting Department is $211,333 while total cost allocated to Assembly Department is $278,667.

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Answer:

The correct answer is B

Explanation:

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8 0
3 years ago
The following data relating to direct materials cost for October of the current year are taken from the records of Good Clean Fu
ivanzaharov [21]

Answer:

Standard price= $6.1

Explanation:

Giving the following information:

The quantity of direct materials used 3,800 lbs. Actual unit price of direct materials $6 per lb. Units of finished product manufactured 1,820 units Standard direct materials per unit of finished product 2 lbs.

Direct materials quantity variance—unfavorable $976 Direct materials price variance—favorable $380.

Direct material price variance= (standard price - actual price)*actual quantity

380= (SP - 6)3,800

6.1= standard price

Direct material quantity variance= (standard quantity - actual quantity)*standard price

976= (1820*2 - 3,800)*SP

6.1= standard price

5 0
3 years ago
The Wilson Company purchased $35,000 of merchandise from the Poole Wholesale Company. Wilson also paid $2,800 for freight costs
Olin [163]

Answer:

Option A, total debits to the inventory account would be $37,800, is correct

Explanation:

The cost of the merchandise inventory to Wilson Company is the cost of the inventory purchased and the freight-in cost.

In other words, the amount to be recognized in merchandise inventory account is the sum of both amounts i.e $35,000+$2800=$37,800

This would be debited to merchandise inventory and $2,800 would be credited to the cash account while $35,000 is credited to accounts payable

4 0
3 years ago
The 5 specific forces acting as stimulant for change
Serjik [45]

Answer:

1. Technology.

2. Social trends.

3. Economic shocks.

4. Political.

5. Nature of the workforce.

Explanation:

According to the amiable philosopher and mathematician, Alfred North Whitehead, "The art of progress is to preserve order amid change and to preserve change amid order."

The 5 specific forces acting as stimulant for change in an organization or business environment are;

1. Technology: it is a major external force, organizations should make use of new technologies, so as to maximize efficiency and increase productivity.

2. Social trends: social media changes can bring individuals together and influence their interests to share opinions, cultures perception and ideas.

3. Economic shocks: indices of gross domestic products such as unemployment, acquisitions, bankruptcy, recession impacts an organization.

4. Political: government policies, regulations and restrictions such as tax, minimum wage etc can cause a change in a firm. Companies should ensure they are operating at top notch in the competitive market.

5. Nature of the workforce: they should be able to adapt or respond to economic activities, such as demographic, immigration, multicultural society, etc.

Change agents in an organization are individuals acting as catalysts by assuming responsibilities for managing any of the aforementioned specific forces acting as stimulant for change.

7 0
3 years ago
The classical dichotomy is the separation of real and nominal variables. The following questions test your understanding of this
mylen [45]

Answer:

A) The price of a donut is $2.00 in 2009.

B) Rina's wage is $14.00 per hour in 2009.

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When valuing a variable as an exchange for another good, that is assigning a real value to that variable since monetary changes won't affect the relationship between two goods.

The answers are A) and B)

7 0
3 years ago
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