1. Stampede Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below: FROM TO Purchasing Maintenance Fabrication Assembly Purchasing 0% 45% 45% 10% Maintenance 55% 0% 30% 15% The direct operating costs of the departments (including both variable and fixed costs) were as follows: Purchasing $ 138,000 Maintenance 60,000 Fabrication 114,000 Assembly 90,000 The total cost accumulated in the fabrication department using the direct method is: 2. Bifurcator Company produces three products — X, Y, and Z — from a joint process. Each product may be sold at the split-off point or processed further. Additional processing requires no special facilities, and production costs of further processing are entirely variable and traceable to the products involved. Last year all three products were processed beyond split-off. Joint production costs for the year were $134,000. Sales values and costs needed to evaluate Bifurcator's production policy follow. Product Units Produced Sales Value at Split Off If Processed Further Sales Value Additional Costs x 22,000 $ 43,500 $ 97,500 $ 4,700 y 12,000 25,500 50,500 10,000 z 6,000 30,000 44,000 12,000 The amount of joint costs allocated to product X using the sales value at split-off method is:

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 1PA: The following product Costs are available for Haworth Company on the production of chairs: direct...

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1. Stampede Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below:

FROM	TO
Purchasing	Maintenance	Fabrication	Assembly
Purchasing	0%	45%	45%	10%
Maintenance	55%	0%	30%	15%

The direct operating costs of the departments (including both variable and fixed costs) were as follows:

Purchasing	$ 138,000
Maintenance	60,000
Fabrication	114,000
Assembly	90,000

The total cost accumulated in the fabrication department using the direct method is:

2. Bifurcator Company produces three products — X, Y, and Z — from a joint process. Each product may be sold at the split-off point or processed further. Additional processing requires no special facilities, and production costs of further processing are entirely variable and traceable to the products involved. Last year all three products were processed beyond split-off. Joint production costs for the year were $134,000. Sales values and costs needed to evaluate Bifurcator's production policy follow.