Step method Leander Mfg. has three support departments (human resources, administration, and maintenance) and two revenue-generating departments (assembly and finishing). The company uses the step method to allocate support department costs to operating departments. In October, human resources incurred $432,000 of costs, administration incurred $669,600, and maintenance incurred $204,000. Proportions of services provided to other departments for October follow. Human Resources Administration Maintenance Human resources Administration Maintenance Assembly Finishing To Administration $ To Maintenance To Assembly To Finishing Total $ 432,000 a. Assume that the departments are listed in a benefits-provided ranking. Note: Do not round proportions in your calculations; round your final answer to the nearest whole dollar. To Administration $ To Maintenance To Assembly To Finishing Total 10% 15 40 35 1. What amount of cost should be assigned from human resources to each of the other departments? 43,200 ✓ 64,800 172,800 ✓ 151,200 ✓ $ 10% 712,800 x 79,200 ✓ 10 50 30 396,000 ✓ 237,600 ✓ 0 x 5% 15 2. What amount of cost should be assigned from administration to each of the other departments? 45 35

Step method Leander Mfg. has three support departments (human resources, administration, and maintenance) and two revenue-generating departments (assembly and finishing). The company uses the step method to allocate support department costs to operating departments. In October, human resources incurred $432,000 of costs, administration incurred $669,600, and maintenance incurred $204,000. Proportions of services provided to other departments for October follow. Human Resources Administration Maintenance Human resources Administration Maintenance Assembly Finishing To Administration $ To Maintenance To Assembly To Finishing Total $ 432,000 a. Assume that the departments are listed in a benefits-provided ranking. Note: Do not round proportions in your calculations; round your final answer to the nearest whole dollar. To Administration $ To Maintenance To Assembly To Finishing Total 10% 15 40 35 1. What amount of cost should be assigned from human resources to each of the other departments? 43,200 ✓ 64,800 172,800 ✓ 151,200 ✓ $ 10% 712,800 x 79,200 ✓ 10 50 30 396,000 ✓ 237,600 ✓ 0 x 5% 15 2. What amount of cost should be assigned from administration to each of the other departments? 45 35

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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