Posh Bakery has two support departments, machine maintenance (MM) and human resources (HR). Machine maintenance costs for the year total $500,000 and are allocated according to the number of budgeted machine hours expected for each department. HR costs for the year total $200,000 and are allocated based on employee head count. Use the data below to allocate support department costs to Posh Bakery's two production departments: Pies and Cakes. MM: Machine hours HR: Number of employees Costs to allocate Support Departments Machine Maintenance 2,000 20 $ 500,000 Production Departments Human Resources Pies Cakes 0 15,000 $ 200,000 40 $0 5,000 40 Total 22,000 107 $ 0 $ 700,000 Required: Prepare a schedule that allocates support department costs using the step-down method. Posh Bakery has decided to allocate human resources costs first. Compute the total amount of support costs allocated to each operating department: Pies and Cakes. Question a. What is the total amount of support costs allocated to Pies? b. What is the total amount of support costs allocated to Cakes? Answer Total $ 0.00
Posh Bakery has two support departments, machine maintenance (MM) and human resources (HR). Machine maintenance costs for the year total $500,000 and are allocated according to the number of budgeted machine hours expected for each department. HR costs for the year total $200,000 and are allocated based on employee head count. Use the data below to allocate support department costs to Posh Bakery's two production departments: Pies and Cakes. MM: Machine hours HR: Number of employees Costs to allocate Support Departments Machine Maintenance 2,000 20 $ 500,000 Production Departments Human Resources Pies Cakes 0 15,000 $ 200,000 40 $0 5,000 40 Total 22,000 107 $ 0 $ 700,000 Required: Prepare a schedule that allocates support department costs using the step-down method. Posh Bakery has decided to allocate human resources costs first. Compute the total amount of support costs allocated to each operating department: Pies and Cakes. Question a. What is the total amount of support costs allocated to Pies? b. What is the total amount of support costs allocated to Cakes? Answer Total $ 0.00
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter4: Accounting For Factory Overhead
Section: Chapter Questions
Problem 9E: A manufacturing company has two service and two production departments. Human Resources and Machine...
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