Homework Help is Here – Start Your Trial Now!
Business
Accounting
Bramble Juice

Bramble Juice

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

A35.

 

Bramble Juice Company produces and distributes concentrated orange juice. It has been operating in two key customer segments for years, selling to institutional customers and retail customers. The production departments are supported by the following three services: Administrative, Information Systems, and Maintenance. To date, the accounting team has simply allocated the support costs evenly between the two operating segments in order to determine total costs. Realizing that there are more accurate ways of assigning these costs, the new controller has asked you to prepare support department cost allocations using three other (and arguably more accurate) methods. Financial information is as follows. Original costs Proportion of Administrative hours used Proportion of Information Systems hours used Proportion of Maintenance hours used Total costs $ Administrative Institutional $77,000 0.20 0.10 Support Departments Operating Units Information Systems $110,600 Retail 0.10 0.10 Maintenance Institutional Retail $62,000 $648,000 $351,000 0.10 Operating Segments 0.10 I 0.45 0.40 Use Excel to determine the total costs that each operating segment would be accountable for if support costs are allocated using the reciprocal method. (Round answers to 2 decimal places, e.g. 15.25.) 0.30 0.35 0.30 0.50
Transcribed Image Text:Bramble Juice Company produces and distributes concentrated orange juice. It has been operating in two key customer segments for years, selling to institutional customers and retail customers. The production departments are supported by the following three services: Administrative, Information Systems, and Maintenance. To date, the accounting team has simply allocated the support costs evenly between the two operating segments in order to determine total costs. Realizing that there are more accurate ways of assigning these costs, the new controller has asked you to prepare support department cost allocations using three other (and arguably more accurate) methods. Financial information is as follows. Original costs Proportion of Administrative hours used Proportion of Information Systems hours used Proportion of Maintenance hours used Total costs $ Administrative Institutional $77,000 0.20 0.10 Support Departments Operating Units Information Systems $110,600 Retail 0.10 0.10 Maintenance Institutional Retail $62,000 $648,000 $351,000 0.10 Operating Segments 0.10 I 0.45 0.40 Use Excel to determine the total costs that each operating segment would be accountable for if support costs are allocated using the reciprocal method. (Round answers to 2 decimal places, e.g. 15.25.) 0.30 0.35 0.30 0.50
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 2 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Tax Planning and Strategies
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS