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Assume a company has only one service department and two operating departments (A and B). The service department's budgeted variable costs in total and on a per unit basis were $200,000 and $5, respectively. Its total actual variable costs were $211,000. The service department's budgeted and actual fixed costs were $300,000 and $315,000, respectively. The service department's variable costs are allocated to the operating departments based on actual number of employees for the current year, whereas its fixed costs are allocated based on the long-run average number of employees in the operating departments. The following additional information was provided for Departments A and B: Department Department A B Actual number of employees for the current year Long-run average number of employees 9,000 12,000 30,000 32,000 The total amount of service department costs that should be charged to Department B is closest to: (Do not round your intermediate calculations.) Multiple Choice О $372,399.

Assume a company has only one service department and two operating departments (A and B). The service department's budgeted variable costs in total and on a per unit basis were $200,000 and $5, respectively. Its total actual variable costs were $211,000. The service department's budgeted and actual fixed costs were $300,000 and $315,000, respectively. The service department's variable costs are allocated to the operating departments based on actual number of employees for the current year, whereas its fixed costs are allocated based on the long-run average number of employees in the operating departments. The following additional information was provided for Departments A and B: Department Department A B Actual number of employees for the current year Long-run average number of employees 9,000 12,000 30,000 32,000 The total amount of service department costs that should be charged to Department B is closest to: (Do not round your intermediate calculations.) Multiple Choice О $372,399.

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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Assume a company has only one service department and two operating departments (A and B). The service department's budgeted variable costs in total and on a per unit basis were $200,000 and $5, respectively. Its total actual variable costs were $211,000. The service department's budgeted and actual fixed costs were $300,000 and $315,000, respectively. The service department's variable costs are allocated to the operating departments based on actual number of employees for the current year, whereas its fixed costs are allocated based on the long-run average number of employees in the operating departments. The following additional information was provided for Departments A and B: Department Department A B Actual number of employees for the current year Long-run average number of employees 9,000 12,000 30,000 32,000 The total amount of service department costs that should be charged to Department B is closest to: (Do not round your intermediate calculations.) Multiple Choice О $372,399.
Transcribed Image Text:Assume a company has only one service department and two operating departments (A and B). The service department's budgeted variable costs in total and on a per unit basis were $200,000 and $5, respectively. Its total actual variable costs were $211,000. The service department's budgeted and actual fixed costs were $300,000 and $315,000, respectively. The service department's variable costs are allocated to the operating departments based on actual number of employees for the current year, whereas its fixed costs are allocated based on the long-run average number of employees in the operating departments. The following additional information was provided for Departments A and B: Department Department A B Actual number of employees for the current year Long-run average number of employees 9,000 12,000 30,000 32,000 The total amount of service department costs that should be charged to Department B is closest to: (Do not round your intermediate calculations.) Multiple Choice О $372,399.
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