Vernon Services Company has 53 employees, 38 of whom are assigned to Division A and 15 to Division B. Vernon incurred $318,530of fringe benefits cost during year 2.RequiredDetermine the amount of the fringe benefits cost to be allocated to Division A and to Division B.AllocatedCostDivisionAB

Cost Allocation Method: The cost allocation method is the method by which the costs to be assigned…

Answered: Vernon Services Company has 53…

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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Cheyenne's Medical operates three support departments and two operating units, Surgery and ER. The support departments are allocated based on the hours used. The cost of operating the accounting (acct), administration (admin), and human resources (HR) departments is $271000, $158300, and $68800, respectively. Information on the hours used are as follows: Hours in Acct Hours in Admin Hours in HR Acct O $0. O $91022. O $87397. O $96079. 16 8 Admin 20 4 HR 48 8 Surgery 360 120 65 ER 220 80 130 What are the total costs allocated from the HR department to the operating units? (Round intermediate calculations to 2 decimal places, e.g. 52.75.)
What amount of RGP should be reported for the current year if the percentage of completion method is used for all contracts?
Sierra Company has two operating departments: Mixing and Bottling. Mixing occuples 26,460 square feet. Bottling occupies 17,640 square feet. Maintenance costs of $226,000 are allocated to operating departments based on square feet occupied. Determine the maintenance costs allocated to each operating department. Department Mixing Bottling Total Square Feet 0 Percent of Total % % 0.00 % Cost Allocated $ 0
Canfield Construction applies overhead to its projects at a rate of $78 per direct labor hourLaborers are paid an average rate of $40 per hourThe Jefferson Apartments project was charged a total of $2,700,000 in direct materials and $580,000 in direct labor costs Overhead applied to the Jefferson Apartments project amounted to:
Baird Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows. Expected Costs Direct labor Home 1 Home 2 Home 3 $ 72,000 106,000 $109,000 141,000 $173,000 Direct materials 188,000 Assume Baird needs to allocate two major overhead costs ($53,100 of employee fringe benefits and $39,150 of indirect materials costs) among the three jobs. Required Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. (Round "Allocation rate" to 2 decimal places.) Fringe Benefits: Home Allocation Rate x Weight of Base Allocated Cost 1 $ %3D X %3D Total 2$ II
The following figures have been extracted from the department P of Q Ltd. Direct material used $ 20000 Direct Wages $ 30000 Total overheads allocated to this department are $25000. On an order the department carried outjob no. 163. The details ofjob no. 163 are as follows: Direct material used $ 600 Direct Wages $ 1200 Find out the overhead amount absorbedon job no. 163 under each of the following methods 1) Percentage on direct material cost basis. (ii) Percentage on prime cost basis.
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 Accounting Total allocations Direct costs Total costs 0 0.10 $ 240,000 Facilities 0.40 Accounting $ 209,500 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? Using Department Training 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. 0.30 0.20 $ 380,000 Facilities Independent 0.20 0.20 $ 206,000 Cost Allocation To: Training Commercial 0.10 0.50 $ 292,000 Independent Commercial
None
37. Norte Company has three manufacturing divisions, each of which has been Determined to be reportable segment. Common costs are appropriately allocated on the basis of each division’s sales in relation to Norte’s aggregate sales. In the current year, Division 1 had sales of P6,000,000, which was 20%of Norte’s total sales, and had traceable cost of P3,800,00. Norte incurred operating cost of P1,000,000 that were not directly traceable to any of the divisions. In addition, Norte incurred interest expense of P600,000. In reporting segment information, what amount should be shown as operating profit of Division 1 for the current year? CHOICES: P1,880,000 P1,400,000 P2,000,000 P2,200,000
Hel Jordan Services Company has 68 employees, 26 of whom are assigned to Division A and 42 to Division B. Jordan incurred $413,440 of fringe benefits cost during year 2. Required Determine the amount of the fringe benefits cost to be allocated to Division A and to Division B. Allocated Cost Division A B
CS Company started work on three job sites during the current year. Any costs incurred are expected to be recoverable. Data relating to the three jobs are given below: Billings on Contract Site Contract Cost Estimated Costs to Complete Collections on Price Incurred 3,750,000 1,000,000 Billings 5,000,000 900,000 1,000,000 1 5,000,000 5,000,000 900,000 2 7.000,000 2.500.000 4,000,000 3 1.000,000 1,000,000 1.500,000 1. If the company recoeds revenue over time, how much must be shown as current asset in the balance sheet of MOC Construction Company as of December 31? A. 5,500,000 B. S00,000 C 250,000 D. 100,000 2. If the company records revenue at a point in time, how much must be shown as current asset in the balance sheet of MOC Construction Company as of December 317 A. 5,100,000 8. S00,000 C 250,000 D. 100,000

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