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Support department cost allocation-reciprocal services method Temple Lights, Inc. produces Hanukkah menorahs in its Cutting and Molding departments. The Maintenance and Security departments support the production of the menorahs. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table Maintenance Department 800 $2,000 $37,440 Security Department Cutting Department 6,400 Holding Department 11,600 Machine hours 2,000 $1,300 $2,500 Asset value Department cost $5,500 $16,640 $65,000 181,000 Determine the total cost of each production department after allocating all support department costs to the production departments using the reciprocal services metho Production departments total costs Cutting Holding Department Department

Support department cost allocation-reciprocal services method Temple Lights, Inc. produces Hanukkah menorahs in its Cutting and Molding departments. The Maintenance and Security departments support the production of the menorahs. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table Maintenance Department 800 $2,000 $37,440 Security Department Cutting Department 6,400 Holding Department 11,600 Machine hours 2,000 $1,300 $2,500 Asset value Department cost $5,500 $16,640 $65,000 181,000 Determine the total cost of each production department after allocating all support department costs to the production departments using the reciprocal services metho Production departments total costs Cutting Holding Department Department

FINANCIAL ACCOUNTING
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-reciprocal services method Temple Lights, Inc. produces Hanukkah menorahs in its Cutting and Molding departments. The Maintenance and Security departments support the production of the menorahs. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table: Maintenance Department Machine hours 800 Asset value $2,000 Department cost $37,440 Determine the total cost of each production Production departments total costs Security Department Cutting Department Holding Department 2,000 6,400 $1,380 $2,500 $16,640 $65,000 department after allocating all support department costs to the production departments using the reciprocal services method. Cutting Molding Department Department 11,600 $5,500 181,000
Transcribed Image Text:Support department cost allocation-reciprocal services method Temple Lights, Inc. produces Hanukkah menorahs in its Cutting and Molding departments. The Maintenance and Security departments support the production of the menorahs. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table: Maintenance Department Machine hours 800 Asset value $2,000 Department cost $37,440 Determine the total cost of each production Production departments total costs Security Department Cutting Department Holding Department 2,000 6,400 $1,380 $2,500 $16,640 $65,000 department after allocating all support department costs to the production departments using the reciprocal services method. Cutting Molding Department Department 11,600 $5,500 181,000
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