Calculate the total cost of the main segments using the direct cost re-allocation method To present the main advantages and disadvantages of the direct method of cost re-sharing.
- costing) could be effectively applied.
(3) The manufacturing company ALPHA SA, which produces cloth masks, has 3 main production departments (K1, K2, K3) and 3 auxiliary departments (B1, B2, B3). The direct cost for the use of the 20x9 was formed in the sections as follows:
|
|
Amount |
|
U1 |
210.000€ |
|
K2 |
140.000€ |
|
K3 |
80.000€ |
|
B1 |
45.000€ |
|
B2 |
20.000€ |
|
B3 |
10.000€ |
The bases used to re-share the cost of auxiliary parts as follows:
|
Auxiliary section |
Cost repartition basis of auxiliary parts |
|
B1 |
Square meters |
|
B2 |
Number of employees |
|
B3 |
Number of visits |
The following table summarizes the use of ancillary services by other auxiliary and main sections for the use of 20X9:
|
Department |
Repartition basis |
B1 |
B2 |
B3 |
U1 |
K2 |
K3 |
|
B1 |
Square meters |
|
8.100 |
3.900 |
27.000 |
36.000 |
6.000 |
|
B2 |
Number of employees |
3 |
|
6 |
30 |
15 |
6 |
|
B3 |
Number of visits |
|
|
|
15 |
40 |
5 |
Requested:
- Calculate the total cost of the main segments using the direct cost re-allocation method
- To present the main advantages and disadvantages of the direct method of cost re-sharing.
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