Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $300,000 are allocated on the basis ofbudgeted warehouse - hours. Data Center Department costs of $120,000 are allocated based on the number of computer log - on hours. The costs of operatingdepartments Music and Books are $105,000 and $126,000, respectively. Data on budgeted warehouse - hours and number of computer log - on hours are as follows:Support DepartmentsProduction DepartmentsWarehouseData CenterMusicBooksDepartment$300,000Department$120,000Budgeted costsBudgeted warehouse - hoursNumber of computer hours$105,0001,060$126,000NA5601,520210NA8601,100Using the step - down method, what amount of Warehouse Department cost will be allocated to Department Music if the service department with the highestpercentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations.).....O A. $35,446O B. $40,510O C. $101,274O D. $123,256

Step down method: In this method costs are allocated according to the steps. Costs are first…

Answered: Goldfarb's Book and Music Store has two…

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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IKAR, a small home furniture factory, operates with THREE production departments: Assembly, Polishing, and Packing and TWO service departments: Stores and Maintenance. For the forthcoming period, the total budgeted overhead costs are as follows: Allocated costs: Departments Indirect materials (RM) Indirect labor (RM) Assembly Polishing Packing Stores 3,800 4,630 2,120 900 9,900 8,180 6,200 4,760 5,800 Maintenance 120 The following factory overheads were obtained from the accounts relating to the period: RM 20,180 36,000 56,000 29,000 5,830 7,600 15,000 21,000 Heating and lighting Rent and rate Production supervision Plant depreciation Lubricant Office depreciation Direct labour Direct materials The following information is also available: Department Assembly Polishing Packing Stores Maintenance Number of Employees Floor Area (sq. metr.) 20 12 1150 1800 1250 1350 350 Machine hours 1200 2140 60 Direct labour hours 120 30 50 Plant's values (*000RM) 210 190 50 13 17 Required: Prepare an…
Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $390,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of $100,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $122,500 and $147,000, respectively. Data on budgeted warehouse - hours and number of computer log - on hours are as follows: Support Departments Production Departments Warehouse Data Center Music Books Department $390,000 Department $100,000 Budgeted costs Budgeted warehouse - hours Number of computer hours $122,500 $147.000 NA 580 1,040 1,600 220 NA 810 1,010 Dr Using the step - down method, what amount of Data Center Department cost will be allocated to Department Music if the service department with the highest percentage of interdepartmental support service is allocated first? (Round intermediary calculations to three decimal places.) O A.…
Blackwelder Factory produces two similar products: small table lamps and desk lamps. The total factory overhead budget is $615,000 with 478,000 estimated direct labor hours. It is further estimated that small table lamp production will require 261,000 direct labor hours, and desk lamp production will need 125,000 direct labor hours. Using a single plantwide factory overhead rate with an allocation base of direct labor hours, the factory overhead that Blackwelder Factory will allocate to small table lamp production if actual direct labor hours for the period for small table lamp production is 183,000 would be a.$518,641 b.$877,131 c.$236,070 d.$739,700
Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $310,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $170,000 are allocated based on the number of employees. The costs of operating departments A and B are $192,000 and $288,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows: Budgeted costs Budgeted maintenance-hours Number of employees Support Departments OA $200,588 OB. $124,235 OC. $135415 OD. $74,260 Maintenance Personnel Department Department $310,000 $170,000 NA 900 Production Departments A B $192,000 $288,000 1,210 660 75 NA 660 Using the step-down method, what amount of Maintenance Department cost will be allocated to Department A if the service department with the highest percentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations.) 290
A. The South Department of ABC Corporation is a cost center. The budget for the month of March 20X2 is as follows: Sales salaries 406,725 System support salaries 222, 502 Customer relation salaries 75,975 Accounting salaries 48,345 Depreciation of plant and equipment 45,700 Repairs and maintenance 134,200 Insurance and property taxes 20,245 During March 20X2 the following costs were incurred by South Department: Sales salaries 406,205 System support salaries 222, 450 Customer relation salaries 80,120 Accounting salaries 48,245 Depreciation of plant and equipment 45,700 Repairs and maintenance 138,950 Insurance and property taxes 20,500 REQUIRED: Prepare a performance report for the manager of South Dept for March 20x2. Explain which costs the manager might be expected to request additional reports.
Parker Company has two service departments, Cafeteria and Engineering, and two operating departments. The number of employees in each department is given below: Cafeteria 10 Engineering 40 Operating Department 1 500 Operating Department 2 200 The company uses the step method to allocate service department cost. Cafeteria is allocated first, and then Engineering. The costs of the Cafeteria are allocated to other departments on the basis of number of employees in the departments. If Cafeteria costs are budgeted at R69 375, the amount of cost allocated to Operating Department 2 would be closest to: A. R18 500 B. R18 750 C. R19 821 D. R46 875
Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Activity Cost Activity Base Procurement $302,300 Number of purchase orders Scheduling $220,600 Number of production orders Materials handling $416,500 Number of moves Product development $755,400 Number of engineering changes Production $1,551,600 Machine hours Number ofPurchaseOrders Number ofProductionOrders NumberofMoves Number ofEngineeringChanges MachineHours NumberofUnits Disk drives 4,160 380 1,320 11 1,900 1,600 Tape drives 2,500 155 770 6 9,900 4,000 Wire drives 12,700 770 3,900 23 10,400 2,700 Determine the activity rate per production order for…
The Document Creation Center (DCC) for Arlington Corp. provides photocopying and document services for three departments in the Minneapolis office. The following budget has been prepared for the year. Available capacity 8,030,000 pages Budgeted usage: Software Development 1,630,000 pages Training 3,333,000 pages Management 2,127,000 pages Cost equation $310,000 + $0.02 per page If DCC uses a dual-rate for allocating its costs, how much cost will be allocated to the Management Department, assuming the Management Department actually made 2,130,000 copies during the year? Multiple Choice $84,670. $86,790. $86,275. $135,600.
Betty's Book and Music Store has two service departments, Warehouse and Data Centre. Warehouse Department costs of $175,000 are allocated on the basis of budgeted warehouse-hours. Data Centre Department costs of $75,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $125,000 and $150,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Production Departments Warehouse Department Data Centre Department Music Books Budgeted costs $175,000 $75,000 $125,000 $150,000 Budgeted warehouse-hours NA 250 500 750 Number of computer hours 100 NA 400 500 Required: Assign the support department costs to the production departments using: The Direct Method (3) The Step-Down Method assigning the Warehouse Department first (4) The Reciprocal Method using linear equations. (4)
XYZ's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $280,000 are allocated based on budgeted warehouse-hours. Data Center Department costs of $80,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $90,000 and $108,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Budgeted costs Budgeted warehouse-hours O $122,500 Production Departments O $126,000 Number of computer hours 400 O $98,000 Warehouse Department O $98,000 $280,000 ΝΑ Data Center Department $80,000 500 ΝΑ Support Departments Music $90,000 1,125 900 Books Using the direct method, what amount of Warehouse Department costs will be allocated to Department Books? (Do not round any intermediary calculations.) $108,000 875 700
Hanung Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $370,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $120,000 are allocated based on the number of employees. The costs of operating departments A and B are $196,000 and $294,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows: Production Departments Budgeted costs $370,000 Budgeted maintenance- hours Number of employees Maintenance Personnel Department Department 200 Support Departments 90 870 A $120,000 $196,000 $294,000 15 B 1,260 670 280 680 Using the direct method, what amount of Personnel Department costs will be allocated to Department B? (Do not round any intermediary calculations.)
Akagera Finance Plc has two service departments, the Human Resources (HR) Department and the Computing Department. Akagera Finance Plc has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows: User of Service Provider of Service HR Computing HR 0 10% Computing 10% 0 Deposit 55% 50% Loan 35% 40% The budgeted costs in the two service departments for the year are as follows: HR $ 529,000 Computing 758,500 Required: Use the reciprocal-services method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments

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