HomeLife Life Insurance Company has two service departments (actuarial and premium rating) and two production departments (advertising and sales). The distribution of each service department's efforts (in percentages) to the other departments is shown in the following table from Actuarial Premium Actuarial Actuarial Premium rating Advertising Sales Premium Rating 80% 20% A The direct operating costs of the departments (including both variable and fixed costs) are $ 92,000 27,000 To 72,000 52,000 Advertising Sales 10% 10% 20 60 Required: 1. Determine the total costs of the advertising and sales departments after u

HomeLife Life Insurance Company has two service departments (actuarial and premium rating) and two production departments (advertising and sales). The distribution of each service department's efforts (in percentages) to the other departments is shown in the following table from Actuarial Premium Actuarial Actuarial Premium rating Advertising Sales Premium Rating 80% 20% A The direct operating costs of the departments (including both variable and fixed costs) are $ 92,000 27,000 To 72,000 52,000 Advertising Sales 10% 10% 20 60 Required: 1. Determine the total costs of the advertising and sales departments after u

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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The unallocated income statement of de Souza Motel is shown below: Rooms F&B Total Revenue 257,000 130,000 387,000 Cost of Sales 48,000 48,000 Payroll and Related Expenses 60,000 30,000 90,000 Other Direct Expenses 40,000 12,000 52,000 Total Expenses 100,000 90,000 190,000 Departmental Income 157,000 40,000 197,000 Administrative &General 60,000 Sales& Marketing 25,000 POM& Utility costs 20,000 GOP 92,000 Insurance 10,000 Depreciation 12,000 Total Fixed Charges 22,000 Income Before Income Taxes 70,000 Income Taxes 30,000 Net income 44,000 Additional Information: Square Footage: Rooms: 120,000 F&B 80,000 Answers: (Correct or Wrong) Rooms department income before taxes is 67,600 F&B department income before taxes is (2,000) The De Souza Motel…
HomeLife Life Insurance Company has two service departments (actuarial and premium rating) and two production departments (advertising and sales). The distribution of each service department's efforts (in percentages) to the other departments is shown in the following table: Actuarial Premium rating Advertising Sales From Actuarial Premium The direct operating costs of the departments (including both variable and fixed costs) are: Actuarial Premium Rating 80% 25% $ 87,000 22,000 67,000 47,000 Advertising department Sales department To Advertising Sales 15% 5% 15 Required 1 Required 2 Required 3 Required: 1. Determine the total costs of the advertising and sales departments after using the direct method of allocation. 2. Determine the total costs of the advertising and sales departments after using the step method of allocation. 3. Determine the total costs of the advertising and sales departments after using the reciprocal method of allocation. Complete this question by entering your…
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