Frame Corporations' Maintenance Department 6. Frame Corporation's Maintenance Department provides services to the company's two operating divisions-the Paints Division and the Stains Division. The variable costs of the Maintenance Department are budgeted based on the number of cases produced by the operating departments. The fixed costs of the Maintenance Department are determined by the number of cases produced by the operating departments during the peak period. Data appear below: Maintenance Department Budgeted variable cost.. Budgeted total fixed cost $246,000 $328,000 $254,014 Actual total variable cost Actual total fixed cost. $331,940 Paints Division 35% Percentage of peak period capacity required Budgeted cases...... 12,000 Actual cases 12,010 Stains Division Percentage of peak period capacity required 65% Budgeted cases..... 29,000 Actual cases 28,960 How much of the Maintenance Department's actual costs should not be allocated to the operating divisions at the end of the year? A) $12,134 B) $8,194 C) $11,954 D) $3,940 E) $8,014 PLEASE SHOW YOUR WORK I DONT UNDERSTAND WHY THE ANSWER IS E) AND NOT A)
Frame Corporations' Maintenance Department 6. Frame Corporation's Maintenance Department provides services to the company's two operating divisions-the Paints Division and the Stains Division. The variable costs of the Maintenance Department are budgeted based on the number of cases produced by the operating departments. The fixed costs of the Maintenance Department are determined by the number of cases produced by the operating departments during the peak period. Data appear below: Maintenance Department Budgeted variable cost.. Budgeted total fixed cost $246,000 $328,000 $254,014 Actual total variable cost Actual total fixed cost. $331,940 Paints Division 35% Percentage of peak period capacity required Budgeted cases...... 12,000 Actual cases 12,010 Stains Division Percentage of peak period capacity required 65% Budgeted cases..... 29,000 Actual cases 28,960 How much of the Maintenance Department's actual costs should not be allocated to the operating divisions at the end of the year? A) $12,134 B) $8,194 C) $11,954 D) $3,940 E) $8,014 PLEASE SHOW YOUR WORK I DONT UNDERSTAND WHY THE ANSWER IS E) AND NOT A)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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