A company incurred $120,000 of common fixed costs and $180,000 of common variable costs. These costs are to be allocated to Departments XX and YY. Data on capacityprovided and capacity used are as follows:DepartmentXXYYCapacity Providedin Hours500300Capacity Usedin Hours400400Assume that common fixed costs are to be allocated to Departments XX and YY on the basis of capacity provided and that common variable costs are to be allocated toDepartments XX and YY on the basis of capacity used. The fixed and variable costs allocated to Department XX are:FixedVariable$75,000$112,500O b.$75,000$90,000Ос$60,000$112,500Od$60,000$90,000

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Answered: A company incurred $120,000 of common…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Exercise 11-31 (Algo) Cost Allocation: Reciprocal Method, Two Service Departments (LO 11-1) Activity and selected costs for three production departments (Training. Independent, and Commercial) and two service departments (Accounting and Facilities) at DuBay Films for the past month follow: Supplying Department Accounting Facilities Direct cost From: Service department costs Accounting Facilities Total allocations Accounting 8 0.20 $ 190,000 Direct costs Total costs Facilities 0.40 $ 184,500 Required: Allocate service department costs to Training, Independent, and Commercial using the reciprocal method. What are the total costs of Training, Independent, and Commercial after this allocation? Note: Amounts to be deducted should be indicated by a minus sign. Do not round Intermediate calculations. Round your final answers to the nearest whole dollar amounts. Accounting Using Department Training 0.30 0.20 $ 330,000 Facilities Independent 0.20 0.20 $ 201,000 Cost Allocation To: Training…
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B6).
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