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.

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.

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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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

es
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
Direct costs
Total costs
Accounting
0
0.20
$ 180,000
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
$
$
Facilities
0.30
0
$ 179,500
0 $
0
$
Using Department
Training
0.20
0.20
$ 320,000
Facilities
Cost Allocation To:
Training
0 $
Independent
0.10
0.10
$ 200,000
0 $
0 $
0 $
Commercial
0.40-
0.50
$ 286,000
Independent
0 $
0 $
Commercial
0
0

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