Salsa has two service departments, the IT Department and HR Department. Salsa also has two production departments, the Cutting department and the Mixing Department. The usage of the two service departments’ output for the year is as follows: ---Provider of Service---- User of Service / IT /HR IT / - /15 % HR / 5 % / - Cutting / 45 % / 25 % Mixing / 50 % / 60 % The budgeted costs in the two service departments for the year as follows: IT: $ 400,000 HR: $ 600,000 Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgeted costs of the two service departments to production departments. 5.) Salsa has two service departments, the IT Department and HR Department. Salsa also has two productiondepartments, the Cutting department and the Mixing Department. The usage of the two service departmentsoutput for the year is as follows:User of ServiceITHRCuttingMixingIT5%45 %50 %Provider of ServiceHR15%25%60 %The budgeted costs in the two service departments for the year as follows:IT: $ 400,000HR: $ 600,000Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgetedcosts of the two service departments to production departments.

The cost incurred by service departments are allocated to the manufacturing departments so that the…

Salsa has two service departments, the IT Department and HR Department. Salsa also has two production departments, the Cutting department and the Mixing Department. The usage of the two service departments’ output for the year is as follows: ---Provider of Service---- User of Service / IT /HR IT / - /15 % HR / 5 % / - Cutting / 45 % / 25 % Mixing / 50 % / 60 % The budgeted costs in the two service departments for the year as follows: IT: $ 400,000 HR: $ 600,000 Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgeted costs of the two service departments to production departments.

Salsa has two service departments, the IT Department and HR Department. Salsa also has two production departments, the Cutting department and the Mixing Department. The usage of the two service departments’ output for the year is as follows: ---Provider of Service---- User of Service / IT /HR IT / - /15 % HR / 5 % / - Cutting / 45 % / 25 % Mixing / 50 % / 60 % The budgeted costs in the two service departments for the year as follows: IT: $ 400,000 HR: $ 600,000 Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgeted costs of the two service departments to production departments.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter5: Support Department And Joint Cost Allocation

Section: Chapter Questions

Problem 2CMA: Adam Corporation manufactures computer tables and has the following budgeted indirect manufacturing...

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Adam Corporation manufactures computer tables and has the following budgeted indirect manufacturing cost information for the next year: If Adam uses the step-down (sequential) method, beginning with the Maintenance Department, to allocate support department costs to production departments, the total overhead (rounded to the nearest dollar) for the Machining Department to allocate to its products would be: a. 407,500. b. 422,750. c. 442,053. d. 445,000.
5.) Salsa has two service departments, the IT Department and HR Department. Salsa also has two production departments, the Cutting department and the Mixing Department. The usage of the two service departments output for the year is as follows: User of Service IT HR Cutting Mixing IT 5% 45 % 50 % Provider of Service HR 15% 25% 60 % The budgeted costs in the two service departments for the year as follows: IT: $ 400,000 HR: $ 600,000 Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgeted costs of the two service departments to production departments.
Salsa has two service departments, the IT Department and HR Department. Salsa also has two production departments, the Cutting department and the Mixing Department. The usage of the two service departments’ output for the year is as follows: Provider of Service User of Service IT HR IT - 15 % HR 5 % - Cutting 45 % 25 % Mixing 50 % 60 % The budgeted costs in the two service departments for the year as follows: IT: $ 400,000 HR: $ 600,000 Use a.) direct method, b.) step-down method and c.) reciprocal services method to allocate the budgeted costs of the two service departments to production departments. Please donot provide solution in image format provide solution in step by step and fast solution
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