Mackenzie Mining has two operating divisions, Northern and Southern, that share the common costs of the company's human resources (HR) department. The annual costs of the HR department total $25,000,000 a year. You have the following selected information about the two divisions: Northern Southern Fixed Variable Total Number of Employees 2,915 2,385 Required: Determine the cost allocation if $15.0 million of the HR costs are fixed and allocated on the basis of employees, and the remaining costs, which are variable, are allocated on the basis of the wage and salary expense total. Note: Do not round intermediate calculations. Enter your answers in dollars, not in millions or thousands. $ Northern Wage and Salary Expense ($000) $ 241,800 148, 200 0 $ Southern 0

Mackenzie Mining has two operating divisions, Northern and Southern, that share the common costs of the company's human resources (HR) department. The annual costs of the HR department total $25,000,000 a year. You have the following selected information about the two divisions: Northern Southern Fixed Variable Total Number of Employees 2,915 2,385 Required: Determine the cost allocation if $15.0 million of the HR costs are fixed and allocated on the basis of employees, and the remaining costs, which are variable, are allocated on the basis of the wage and salary expense total. Note: Do not round intermediate calculations. Enter your answers in dollars, not in millions or thousands. $ Northern Wage and Salary Expense ($000) $ 241,800 148, 200 0 $ Southern 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Hensel Manufacturing separates its manufacturing overhead costs into 2 broad categories: (1) maintenance costs and (2) utility costs. Maintenance costs average $100,000 per month, whereas utility costs average $8,000 per month. Maintenance costs are allocated to 2 activity cost pools: (1) the repair cost pool and (2) the set-up cost pool. Utility costs also are allocated to 2 activity cost pools: (1) the heating and air conditioning cost pool (HVAC) and (2) the machinery cost pool. Maintenance costs are allocated to their unique activity cost pools on the basis of the number of employees associated with each pool. Utility costs are allocated to their unique activity cost pools on the basis of kilowatt-hour (kWh) consumption. Of the company's maintenance employees, 70% engage primarily in repair activities, whereas 30% engage primarily in set-up activities. Approximately 75% of the company's kWh consumption can be traced to HVAC use, whereas 25% of its kWh consumption can be traced to…
XYZ Co. uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system: Costs: Wages and salaries $160,000 Depreciation 320,000 Utilities 240,000 Total $ 720,000 Distribution of resource consumption: Activity Cost Pools Assembly Setting Up Other Total Wages and salaries 50% 40% 10% 100% Depreciation 10% 55% 35% 100% Utilities 15% 50% 35% 100% How much cost, in total, would be allocated in the first-stage allocation to the Assembly activity cost pool? a. $212,000 O b. $148,000 O c. $360,000 O d. $376,000 O e. None of the given answer is correct.
Fans Company has two service departments-product design and engineering support, and two production departments-assembly and finishing. The distribution of each service department's efforts to the other departments is shown below: SERVICE DEPARTMENT Product Design Engineering Support The direct operating costs of the departments (including both variable and fixed costs) were as follows: Product Design Engineering Support Assembly Finishing Multiple Choice $631,492 Design 0% 20% $1,018.633. SERVICES PROVIDED TO $ 162,000 $ 142,000 $ 552,000 $ 842,000 Support 10% 0% The total cost accumulated in the assembly department using the step method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar. Assume that the engineering support department goes first): Assembly 30% 45% Finishing. 60% 35%
Curry Company has two divisions, Eastern Division and Western Division. Curry Company has been allocating overhead based on direct labor hours. For the most recent year, the predetermined overhead rate was $70 per direct labor hour. An activity-based costing analysis of Curry's operations has identified three different cost pools. Data about the cost drivers for each pool for the most recent year given below. Cost Pool Number of Events per Year Cost Pool A B 2,000 $100,000 1,000 200,000 50,000 $350,000 с 50 Total The following data relate to cost driver event activity within the two divisions during the most recent year. Eastern Division Western Division Total 500 2,000 800 1,000 20 50 3,000 5,000 Cost Driver A events Cost Driver B events Cost Driver C events Direct labor hours 1,500 200 30 2,000 Which of the following statements is correct? If the activity-based costing system had been used in the most recent year in place of the traditional overhead allocation technique, Select one:…
The Fly Company provides advertising services for clients across the nation. The Fly Company is presently working on four projects, each for a different client. The Fly Company accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 68% of media purchases. On August 1, the four advertising projects had the following accumulated costs: August 1 Balances Vault Bank $261,000 Take Off Airlines 85,000 Sleepy Tired Hotels 208,300 Tastee Beverages 122,300 Total $676,600 During August, The Fly Company incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts: Direct Labor Media Purchases Vault Bank $187,000 $717,100 Take Off…
Duweynie Pottery, Inc., is divided into two operating divisions: Pottery and Retail. The company allocates Power and General Factory department costs to each operating division. Power costs are allocated on the basis of the number of machine hours and general factory costs on the basis of square footage. No effort is made to separate fixed and variable costs; however, only budgeted costs are allocated. Allocations for the coming year are based on the following data: Use the rounded values for subsequent calculations. Support Departments Operating Divisions Power General Factory Pottery Retail Overhead costs $150,000 $171,600 $97,000 $55,000 Machine hours 2,000 2,500 7,000 3,000 Square footage 2,500 1,700 4,000 6,000 Round all allocation ratios to four significant digits. Round all allocated amounts to the nearest dollar. Required: 1. Allocate the support service costs using the direct method. Note: Input to two decimal places. Allocation…
Duweynie Pottery, Inc., is divided into two operating divisions: Pottery and Retail. The company allocates Power and General Factory department costs to each operating division. Power costs are allocated on the basis of the number of machine hours and general factory costs on the basis of square footage. No effort is made to separate fixed and variable costs; however, only budgeted costs are allocated. Allocations for the coming year are based on the following data: Use the rounded values for subsequent calculations. Support Departments Operating Divisions Power General Factory Pottery Retail Overhead costs $150,000 $171,600 $97,000 $55,000 Machine hours 2,000 2,500 7,000 3,000 Square footage 2,500 1,700 4,000 6,000 Round all allocation ratios to four significant digits. Round all allocated amounts to the nearest dollar. Required: 2. Allocate the support service costs using the sequential method. The support departments are ranked in order of…
Fans Company has two service departments – product design and engineering support, and two production departments - assembly and finishing. The distribution of each service department's efforts to the other departments is shown below: SERVICES PROVIDED TO SERVICE DEPARTMENT Design Support Assembly Finishing Product Design Engineering Support 0% 10% 30% 60% 20% 0% 45% 35% The direct operating costs of the departments (including both variable and fixed costs) were as follows: $ 192,000 $ 172,000 $ 582,000 $ 872,000 Product Design Engineering Support Assembly Finishing The total cost accumulated in the finishing department using the step method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar assume that the engineering support department goes first): Multiple Cholce $1,083,133. $2,018,000. $734,867. $686,992. $1,006,008.
Eccles Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system: Costs: Wages and salaries $ 349,000 Depreciation 290,000 Utilities 199,000 Total $ 838,000 Distribution of resource consumption: Activity Cost Pools Total Assembly Setting Up Other Wages and salaries 65% 20% 15% 100% Depreciation 35% 20% 45% 100% Utilities 15% 75% 10% 100% How much cost, in total, would be allocated in the first-stage allocation to the Assembly activity cost pool? Multiple Choice $125,700 $544,700 $345,533 $358,200
Eccles Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system: Costs: Wages and salaries Depreciation $ 324,000 225,000 181,000 Utilities Total $ 730,000 Distribution of resource consumption: Activity Cost Pools Setting Up 25% Assembly Other Total Wages and salaries Depreciation Utilities 45% 30% 100% 45% 20% 35% 100% 10% 60% 30% 100% How much cost, in total, would be allocated in the first-stage allocation to the Assembly activity cost pool?
Oriole produces and sells two products-aluminum and vinyl. Each of these products is made in a dedicated manufacturing facility, and the product line managers are evaluated based on the product line's return on investment. The following data is from the most recent year of operations, Aluminum Vinyl Sales $4,000,000 $4,350,000 Variable costs 2,050,000 2,403,750 Direct fixed costs 1,520,000 1,533,000 Average assets 2,000,000 1,500,000 (31) Your answer is correct. Calculate the margin and asset turnover for each product line. (Round answers to 2 decimal places, eg. 5.12 and 5,12%) Aluminum Vinyl Margin 10.75 % 9.50 % 2.00 2.90 Your answer is correct. Calculate return on investment for each product line. (Round ROI to 2 decimal places, e.g. 5.12 %) Aluminum Vinyl ROI 21.50 % 27.55 % eTextbook and Media Attempts: unlimited Both product line managers would like to improve their respective returns on investment, and each manager has a different idea about how to accomplish this. If the…
Direct, sequential, and reciprocal allocationMing Company has two service departments (S1 and S2) and two production departments (P1 and P2). Last year, directly identified overhead costs were $255,000 for S1 and $320,000 for S2.Information on the consumption of their services follows: Supplying User Departments Departments S1 S2 P1 P2 S1 500 1,200 6,000 1,300 S2 800 200 7,000 9,000 (a) Determine the service department costs allocated to the two production departments using the direct method.Note: Round each rate to two decimal places before calculating the allocated amounts. Round answers to the nearest dollar. Rate Total (rounded to 2 decimals) Total P1 Total P2 (any diff due to rounding) S1 allocation amount Answer Answer Answer S1 allocation amount Answer Answer Answer Total service department costs Answer Answer Answer (b) Determine the service department costs allocated to the two production departments using the…