Blue Africa Inc. produces laptops and desktop computers. The company's production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company's production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $255,000. The total cost of the Cafeteria Department is $263,000. The number of employees and the square footage in each department are as follows: Employees Square Feet Security Department 10 600 Cafeteria Department 26 2,400 Laser Department 40 50 4,800 800 Forming Department Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and to each of the production departments. Cafeteria Department Laser Department Forming Department Security Department cost allocation X X X

Blue Africa Inc. produces laptops and desktop computers. The company's production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company's production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $255,000. The total cost of the Cafeteria Department is $263,000. The number of employees and the square footage in each department are as follows: Employees Square Feet Security Department 10 600 Cafeteria Department 26 2,400 Laser Department 40 50 4,800 800 Forming Department Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and to each of the production departments. Cafeteria Department Laser Department Forming Department Security Department cost allocation X X X

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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