Support Department Cost Allocation-Reciprocal Services MethodBrewster Toymakers Inc. produces toys for children. The toys are produced in the Molding and Assembly departments. The Janitorial and Security departments support the production of the toys. Costs from theJanitorial Department are allocated based on square feet. Costs from the Security Department are allocated based on asset value. Relevant department information is provided in the following table:Square feetAsset valueJanitorialDepartmentSecurityDepartment650$140$1,9003,600$160$1,300MoldingDepartment3,600$860Department cost$10,900Using the reciprocal services method of support department cost allocation, determine:AssemblyDepartment1,800$1,000$12,100a. The percentage of Janitorial costs that should be allocated to the Security Department.%b. The percentage of Security costs that should be allocated to the Janitorial Department.%

The service department costs are allocated to different departments using different methods. The…

Support Department Cost Allocation-Reciprocal Services Method Brewster Toymakers Inc. produces toys for children. The toys are produced in the Molding and Assembly departments. The Janitorial and Security departments support the production of the toys. Costs from the Janitorial Department are allocated based on square feet. Costs from the Security Department are allocated based on asset value. Relevant department information is provided in the following table: Janitorial Department Square feet Asset value Security Department 650 $140 $1,900 3,600 $860 Department cost $10,900 Using the reciprocal services method of support department cost allocation, determine: Molding Department 3,600 $160 $1,300 Assembly Department 1,800 $1,000 $12,100 a. The percentage of Janitorial costs that should be allocated to the Security Department. % b. The percentage of Security costs that should be allocated to the Janitorial Department. %

Support Department Cost Allocation-Reciprocal Services Method Brewster Toymakers Inc. produces toys for children. The toys are produced in the Molding and Assembly departments. The Janitorial and Security departments support the production of the toys. Costs from the Janitorial Department are allocated based on square feet. Costs from the Security Department are allocated based on asset value. Relevant department information is provided in the following table: Janitorial Department Square feet Asset value Security Department 650 $140 $1,900 3,600 $860 Department cost $10,900 Using the reciprocal services method of support department cost allocation, determine: Molding Department 3,600 $160 $1,300 Assembly Department 1,800 $1,000 $12,100 a. The percentage of Janitorial costs that should be allocated to the Security Department. % b. The percentage of Security costs that should be allocated to the Janitorial Department. %

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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Support department cost allocation Blue Mountain Masterpieces produces pictures, paintings, and other home decor. The Printing and Framing production departments are supported by the Janitorial and Security departments. Janitorial costs are allocated to the production departments based on square feet, and security costs are allocated based on asset value. Information about these departments is detailed in the following table: Square feet Asset value Janitorial Department 760 $900 $5,200 Security Department 1,040 $1,240 $6,600 a. Direct cost allocation. method. b. Sequential cost allocation method. c. Reciprocal cost allocation method. d. None of the above. d X Printing Department 4,230 $12,390 $33,000 Framing Department 4,770 $8,610 $29,000 Department cost Management has experimented with different support department cost allocation methods in the past. The different allocation methods did not yield large differences of cost allocation to the production departments. 1. Determine which…
Answer question 3-4 using the information below: Fantasy Book and Music Store has two support departments and two production departments. Costs of each department are presented below. Data on budgeted warehouse-hours and number of computer log-on hours for cost allocation of support departments are as follows: Support Departments Production Departments Warehouse Data Center Music Books Budgeted costs Budgeted warehouse-hours Number of computer hours $495,000 1,750 $412,500 3,500 2,800 $1,155,000 $495,000 N/A 5,250 3,500 700 N/A 3. Using the direct method, how much are the total costs of the Books Department? A. $495,000 B. $275,000 C. $693,000 D. $1,463,000 4. Using the step-down method, what amount of Data Center Department cost will be allocated to Music Department if the service department with the highest percentage of interdepartmental support service is allocated first? A. $387,229 B. $220,001 C. $307,267 D. $381,150
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Support Department Cost Allocation-Direct Method Charlie's Wood Works produces wood products (e.g., cabinets, tables, picture frames, and so on). Production departments include Cutting and Assembly. The Janitori and Security departments support the Cutting and Assembly departments. The Assembly Department spans about 50,400 square feet and holds assets valued at abo $88,000. The Cutting Department spans about 33,600 square feet and holds assets valued at about $132,000. Charlie's Wood Works allocates support department ce using the direct method. If costs from the Janitorial Department are allocated Based on square feet and costs from the Security Department are allocated based on a value. a. Determine the percentage of Janitorial costs that should be allocated to the Assembly Department. % b. Determine the percentage of Security costs that should be allocated to the Cutting Department.
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S [The following information applies to the questions displayed below.] Hosmer Industries provides the following information about resources and usage: Resources used Materials Power Setups Purchasing Client assistance Supervision Facility cost Resources supplied Materials Power Setups Purchasing Client assistance Supervision Facility cost Unused Resources Capacity $ 6,600 3,924 2,160 4,680 18,600 8,520 7,080 $ 352,200 47,988 59,076 62, 280 38,520 74,568 128,040 Required: a. Compute the cost driver rate for each resource. Cost Driver Volume 6,400 pounds 272 hours 62 setups 64 purchase orders 40 inquiries 256 labor-hours 3,360 square meters
ervices Method Brewster Toymakers Inc. produces toys for children. The toys are produced in the Molding and Assembly departments. The Janitorial and Security departments support the production of the toys. Costs from the Janitorial Department are allocated based on square feet. Costs from the Security Department are allocated based on asset value. Relevant department information is provided in the following table: Janitorial Security Molding Assembly Department Department Department Department Square feet 610 800 800 6,400 Asset value $120 $140 $880 $1,000' Department cost $2,100 $1,300 $10,900 $12,500 Using the reciprocal services method of support department cost allocation, determine: a. The percentage of Janitorial costs that should be allocated to the Security Department. % b. The percentage of Security costs that should be allocated to the Janitorial Department.
Support Department Cost Allocation—Reciprocal Services Method Blue Africa Inc. produces laptops and desktop computers. The company’s production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company’s production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $252,000. The total cost of the Cafeteria Department is $778,000. The number of employees and the square footage in each department are as follows: Employees Square Feet Security Department 10 540 Cafeteria Department 26 2,400 Laser Department 40 4,800 Forming Department 50 800 Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and to…
Support Department Cost Allocation—Reciprocal Services Method Blue Africa Inc. produces laptops and desktop computers. The company’s production activities mainly occur in what the company calls its Laser and Forming departments. The Cafeteria and Security departments support the company’s production activities and allocate costs based on the number of employees and square feet, respectively. The total cost of the Security Department is $248,000. The total cost of the Cafeteria Department is $333,000. The number of employees and the square footage in each department are as follows: Employees Square Feet Security Department 10 570 Cafeteria Department 28 2,400 Laser Department 40 2,400 Forming Department 50 3,200 Using the reciprocal services method of support department cost allocation, determine the total costs from the Security Department that should be allocated to the Cafeteria Department and…