ll.2 As the managing partner of Marigold Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's threedifferent business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three supportdepartments: Billing. Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along witheach department's usage of those services and its own original costs, are as follows.Support DepartmentsOriginal costBilling hours usedNumber of employeesIT hours used(a)TotalBillingHR$63,000 $110,000$2Audit1002200$IT$102,0001200Operating DivisionsAudit$571.000 $808,0002,000Operating DepartmentsTax12900Tax$1.4001548odeRank the three support departments by their original costs, and then allocate the support department costs using the stepmethod. (Round intermediate calculations to 4 decimal places, eg 15.2516 and final answers to 2 decimal places, eg. 15.25.)Advisory$311.000Advisory6003300Totals$1,965,0004,000352,300Total

The process of allocating indirect costs among various cost objects (such as products, departments,…

As the managing partner of Marigold Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's three different business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three support departments: Billing, Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along with each department's usage of those services and its own original costs, are as follows. Original cost Billing hours used Number of employees IT hours used (a) Total Support Departments Billing HR $63,000 $110,000 Audit 2 100 2 200 IT $102,000 1 200 Tax Operating Divisions Audit Tax $571.000 $808,000 2,000 Operating Departments 12 900 1.400 15 600 Advisory Totals $311.000 $1,965,000 4,000 Rank the three support departments by their original costs, and then allocate the support department costs using the step method. (Round intermediate calculations to 4 decimal places, eg 15.2516 and final answers to 2 decimal places, eg. 15.25.) Advisory 600 3 300 35 2,300 Total

As the managing partner of Marigold Accounting Services (HAS), Adam is trying to compare the profitability results of the firm's three different business lines: Audit, Tax, and Advisory Services. These three operating divisions are supported by three support departments: Billing, Human Resources, and IT. The cost drivers (or allocation bases) for each of the support departments, along with each department's usage of those services and its own original costs, are as follows. Original cost Billing hours used Number of employees IT hours used (a) Total Support Departments Billing HR $63,000 $110,000 Audit 2 100 2 200 IT $102,000 1 200 Tax Operating Divisions Audit Tax $571.000 $808,000 2,000 Operating Departments 12 900 1.400 15 600 Advisory Totals $311.000 $1,965,000 4,000 Rank the three support departments by their original costs, and then allocate the support department costs using the step method. (Round intermediate calculations to 4 decimal places, eg 15.2516 and final answers to 2 decimal places, eg. 15.25.) Advisory 600 3 300 35 2,300 Total

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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