John Company has two service departments, Maintenance and Human Resources. John Company also has two production departments, Mixing and Finishing. Maintenance costs are allocated based on square footage while Human Resources costs are allocated based on number of employees. The information given below has been gathered for the current year. If the direct method is used to allocate service department costs, then the total cost of the Mixing Department after allocation would be

John Company has two service departments, Maintenance and Human Resources. John Company also has two production departments, Mixing and Finishing. Maintenance costs are allocated based on square footage while Human Resources costs are allocated based on number of employees. The information given below has been gathered for the current year. If the direct method is used to allocate service department costs, then the total cost of the Mixing Department after allocation would be

Name: John Company has two service departments, Maintenance and HumanResour
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Description: John Company has two service departments, Maintenance and HumanResources. John Company also has two production departments, Mixing andFinishing. Maintenance costs are allocated based on square footage whileHuman Resources costs are allocated based o

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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es Caro Manufacturing has two production departments, Machining and Assembly, and two service departments, Maintenance and Cafeteria. Direct costs for each department and the proportion of service costs used by the various departments for the month of August follow: Department. Machining Assembly Maintenance Cafeteria Required A Direct Costs $135,000 85,000 47,000 36,000 Required: Use the step method to allocate the service costs, using the following: a. The order of allocation starts with Maintenance. b. The allocations are made in the reverse order (starting with Cafeteria). Complete this question by entering your answers in the tabs below. Required B Required A Proportion of Services Used by Maintenance. Cafeteria. Machining Assembly 0.7 The order of allocation starts with Maintenance. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.) Required B Required: Use the step method to allocate the service costs, using the following: a. The…
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