The following data on overhead apply to the Bernum Woods Company that manufactures golf equipment in three production departments (J-122, J- 123, and J-125). There are two service departments, the Human Resources Department and the Facilities Department. Human Resources Facilities J-122 J-123 J-125 Budgeted overhead $ 16,000.00 $35,000.00 $28,000.00 $145,000.00 $185,000.00 Human Resources * Facilities ** 600 400 800 400 * Row 7 shows the number of hours of usage in the HR department. ** Row 8 shows the amount of floor space. a Direct method b Step method (justify your choice of order) ☛ Reciprocal method 1200 1200 1600 1800 Using hours as the application base for the Human Resources Department and square feet of floor space as the allocation base for the Facilities Department, apply overhead from these service departments to the production departments, using the following three methods:
The following data on overhead apply to the Bernum Woods Company that manufactures golf equipment in three production departments (J-122, J- 123, and J-125). There are two service departments, the Human Resources Department and the Facilities Department. Human Resources Facilities J-122 J-123 J-125 Budgeted overhead $ 16,000.00 $35,000.00 $28,000.00 $145,000.00 $185,000.00 Human Resources * Facilities ** 600 400 800 400 * Row 7 shows the number of hours of usage in the HR department. ** Row 8 shows the amount of floor space. a Direct method b Step method (justify your choice of order) ☛ Reciprocal method 1200 1200 1600 1800 Using hours as the application base for the Human Resources Department and square feet of floor space as the allocation base for the Facilities Department, apply overhead from these service departments to the production departments, using the following three methods:
Chapter1: Financial Statements And Business Decisions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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