am. 254. After starting his first full-time position for a private company, Jason was anxious to go above and beyond the expectations of hissupervisor. So, when Sarah asked him to complete the support department cost allocations for all departments using the same methodas they used last year, he thought, "Here's my chance!" In addition to the step method that this company was currently using, Jasonremembered learning two other methods for allocating these costs—the direct method and the reciprocal method.The two operating segments of this company reflect their locations-Suburban and Downtown. The two support departments areAdministrative Services and Maintenance Services. Their costs have been allocated by administrative hours and maintenance hours,respectively. Here are the relevant costs and usages for all four of these departments.Original costAdministrative hours usedMaintenance hours used(a)Support DepartmentsAdministrative$52,000200Maintenance$39,000100Operating DepartmentsSuburban$185,000250350Downtown$207,000150650Rank the two support departments based on their original cost (as was done last year), and allocate the support department costsusing the step method.

The step allocation method is used for allocating the service department's cost to the operating…

Answered: After starting his first full-time…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 33P

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Please answer the last 3/2 parts of the question. thank you
please answer all if possible, or answer last few parts
The Write Way manufactures double sided pens- a pen on one side, a highlighteron the other. As the accounting manager, Shade is responsible for presenting three different versions of the company's income statement to the rest of the management team at year-end. Team members are very familiar with absorbtion costing, as they have been evaluating gross margin amounts and percentages for years. They are lesss keen on how fixed-MOH impacts the income statment, so Shade gathers the following current information. The information includes three possible capacity levels for calculating the fixed-MOH rate. Shade also notes there are no price or efficiency variances this period. Any fixed-MOH volume variase is written off to COGS.Theoretical level - 80,000 units Practical level - 60,000 units Normal level - 50,000 units Actual production - 65,000 units Sales Volume - 60,000 units Budgeted fixed-MOH cost - $240,000 Budgeted DM cost - $2.25 per unit Budgeted DL cost -$1.30 per unit Budgeted…
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