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ack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair an uality Control. Direct costs for each department and the proportion of service costs used by the various departments for the m arch follow: Department Fabricating Finishing Repair Quality Control Direct Costs Repair $ 140,600 98, 200 42,000 78,400 0 0.3 Proportion of Services Used by Quality Control Fabricating 0.3 0 -quired: e the step method to allocate the service costs, using the following: 0.4 0.2 Finishing 0.3 0.5

ack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair an uality Control. Direct costs for each department and the proportion of service costs used by the various departments for the m arch follow: Department Fabricating Finishing Repair Quality Control Direct Costs Repair $ 140,600 98, 200 42,000 78,400 0 0.3 Proportion of Services Used by Quality Control Fabricating 0.3 0 -quired: e the step method to allocate the service costs, using the following: 0.4 0.2 Finishing 0.3 0.5

FINANCIAL ACCOUNTING
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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Required A Required B Use the step method to allocate the service costs, using the following: The order of allocation starts with Repair. Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermed From: Service department costs Repair Quality control Total costs allocated Show Transcribed Text Required A Required B From: Service department costs Quality control Repair Total costs allocated $ $ $ Repair 42,000 $ (42,000) ✔ Quality Control $ 78,400 (78,400) 0 $ 0 C Use the step method to allocate the service costs, using the following: The allocations are made in the reverse order (starting with Quality Control). Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate c Cost Allocation To: $ Quality Control Fabricating 78,400 $ 140,600 $ 12,600 16,800 (91,000) 26,000 $ 183,400 $ 0 Cost Allocation To: Fabricating Repair $ 42,000 $ 140,600 23,520 15,680 (65,520) 37,440 $ 193,720 0 Finishing $ 98,200 12,600 65,000 175,800 Finishing $ 98,200 39,200 28,080 165,480
Transcribed Image Text:Required A Required B Use the step method to allocate the service costs, using the following: The order of allocation starts with Repair. Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermed From: Service department costs Repair Quality control Total costs allocated Show Transcribed Text Required A Required B From: Service department costs Quality control Repair Total costs allocated $ $ $ Repair 42,000 $ (42,000) ✔ Quality Control $ 78,400 (78,400) 0 $ 0 C Use the step method to allocate the service costs, using the following: The allocations are made in the reverse order (starting with Quality Control). Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate c Cost Allocation To: $ Quality Control Fabricating 78,400 $ 140,600 $ 12,600 16,800 (91,000) 26,000 $ 183,400 $ 0 Cost Allocation To: Fabricating Repair $ 42,000 $ 140,600 23,520 15,680 (65,520) 37,440 $ 193,720 0 Finishing $ 98,200 12,600 65,000 175,800 Finishing $ 98,200 39,200 28,080 165,480
Mack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair and Quality Control. Direct costs for each department and the proportion of service costs used by the various departments for the month of March follow: Department Fabricating Finishing Repair Quality Control Direct Costs Repair $ 140,600 98, 200 42,000 78,400 0 0.3 Proportion of Services Used by Quality Control Fabricating 0.3 0 Required: Use the step method to allocate the service costs, using the following: 0.4 0.2 a. The order of allocation starts with Repair. b. The allocations are made in the reverse order (starting with Quality Control). Finishing 0.3 0.5
Transcribed Image Text:Mack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair and Quality Control. Direct costs for each department and the proportion of service costs used by the various departments for the month of March follow: Department Fabricating Finishing Repair Quality Control Direct Costs Repair $ 140,600 98, 200 42,000 78,400 0 0.3 Proportion of Services Used by Quality Control Fabricating 0.3 0 Required: Use the step method to allocate the service costs, using the following: 0.4 0.2 a. The order of allocation starts with Repair. b. The allocations are made in the reverse order (starting with Quality Control). Finishing 0.3 0.5
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