4Memorial Services, Incorporated (MSI) has three service departments (IT, Accounting, and HR) and twoproduction departments (West and East). The usage data for each of the service departments for theprevious period follow:ITAccountingHRIT--Service department costsIT allocationAccounting allocationHR allocationTotal costs allocated0%10%Accounting HR0%20%0%--10%$--The direct costs of the service departments in the previous period were $91,000 for IT, $116,000 forAccounting, and $155,000 for HR.ITWest40%40%60%Required:Use the direct method to allocate the service department costs to the production departments.Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediatecalculations.East40%60%20%Accounting0 $0 $Check my workHR0 $West0 $East0

According to each department's portion of the allocation base, the direct method divides the costs…

Memorial Services, Incorporated (MSI) has three service departments (IT, Accounting, and HR) and two production departments (West and East). The usage data for each of the service departments for the previous period follow: IT Accounting HR IT ex 10% Service department costs IT allocation Accounting allocation HR allocation Total costs allocated Accounting 0% 10% $ HR 20% 0% -- IT The direct costs of the service departments in the previous period were $91,000 for IT, $116,000 for Accounting, and $155,000 for HR. West East 40% Required: Use the direct method to allocate the service department costs to the production departments. Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. 40% 60% 0 $ 40% 60% 20% Accounting 0 $ HR 0 $ West 0 $ East 0

Memorial Services, Incorporated (MSI) has three service departments (IT, Accounting, and HR) and two production departments (West and East). The usage data for each of the service departments for the previous period follow: IT Accounting HR IT ex 10% Service department costs IT allocation Accounting allocation HR allocation Total costs allocated Accounting 0% 10% $ HR 20% 0% -- IT The direct costs of the service departments in the previous period were $91,000 for IT, $116,000 for Accounting, and $155,000 for HR. West East 40% Required: Use the direct method to allocate the service department costs to the production departments. Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. 40% 60% 0 $ 40% 60% 20% Accounting 0 $ HR 0 $ West 0 $ East 0

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 4CE: Refer to Cornerstone Exercise 7.3. Now assume that Valron Company uses the sequential method to...

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D1. Account
Accounting
Hh1. Account
Subject: Accounting
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