The Hsu Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $449,500 are allocated on the basis of machine hours. The Accounting Department's costs of $138,000 are allocated on the basis of the number of employees within a specific department The direct departmental costs for A and B are $350,000 and $550,000, respectively. Maintenance Accounting A В Machine hours 675 45 2,850 250 Number of employees 8 4 What is the Maintenance Department's cost allocated to Department B (rounded to the nearest whole dollar) using the step method and assuming the Maintenance Department's costs are allocated first? Multiple Choice $413,250. $367,250.

The Hsu Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $449,500 are allocated on the basis of machine hours. The Accounting Department's costs of $138,000 are allocated on the basis of the number of employees within a specific department The direct departmental costs for A and B are $350,000 and $550,000, respectively. Maintenance Accounting A В Machine hours 675 45 2,850 250 Number of employees 8 4 What is the Maintenance Department's cost allocated to Department B (rounded to the nearest whole dollar) using the step method and assuming the Maintenance Department's costs are allocated first? Multiple Choice $413,250. $367,250.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Finest vent Industial Inc. consists of two production departments (Assembly and Machining) and two service departments (Maintenance and Store). The estimated overhead costs and other relevant information for the respective departments are as follows: Assembly Machining Maintenance Store Estimated overhead costs $95,000 $82,000 $46,000 $30,000 Direct labour hours Machine hours 10,000 2,000 5,000 30,000 It has been estimated that each service department does work for other cost centres in the following proportions: Total labour hours used by departments Assembly Machining Maintenance Store Maintenance to Store to 50% 60% 50% 30% 10% Required: (Show all workings clearly and round all solutions to 2 decimal places) (a) Calculate the total overhead costs for the Machining and Assembly departments after the re-apportionment of the costs from the service departments. (b) Calculate the department overhead rates for the Machining and Assembly departments using the appropriate bases.
The Michigan Company provides the following selected data about its three service and two operating departments: Production Dept1 Production Dept2 Service Dept 1 Service Dept 2 Overhead costs 200,000 267,000 180,000 105,000 Number of Employees 315 210 60 35 Square feet of space occupied 40,000 100,000 5,000 10,000 Hours of press time 15,000 30,000 0 0 Direct labor hours 10,000 20,000 0 0 Machine hours 50,000 60,000 The order and bases for allocating service department costs is given below: SD1; allocation base is number of employees SD2; Allocation base is space occupied Assume that PD1 and PD2 both use direct labor hours for computing OH rate. Using the Direct method of allocation, how much OH rate must be assigned to PD1? Using the Step Method of allocation, how much OH rate must be assigned to PD2? Using the Step Method, how much is the cost of SD1 to be allocated to PD2? Using the…
6. A Company has two service departments, Facilities and Human Resources, as well as two line departments, Machining and Assembly. Facilities Department costs are allocated based on square footage and Human Resources Department costs are allocated based on number of employees. The following data was available: Facilities Human Res. Machining $210,000 $180,000 $76,000 1,000 2,000 4,000 30 20 60 8,000 Direct costs Square footage Number of employees Direct labor hours Assembly $85,000 6,000 100 6,000 a) Use the direct method to allocate service department costs to line departments b) Use the step-down method to allocate service department costs to line departments. Start with facilities.
Departmental information for the four departments at Samoa Industries is provided below. Total Cost Cost Driver Square Feet Number of Employees Janitorial $150,000 Square footage serviced 200 40 Cafeteria 50,000 Number of employees 20,000 12 Cutting 1,125,000 4,000 120 Assembly 1,100,000 16,000 40 The Janitorial and Cafeteria departments are support departments. Determine the dollar amount of the Janitorial Department costs to be allocated to the (a) Cutting and (b) Assembly departments using the direct method. a. Cutting Department b. Assembly Department
Highland Publishing Company is a large organization offering a variety of printing and binding work. The Printing and Binding departments are supported by three service departments. The costs of these service departments are allocated to other departments in the order listed below. The Personnel cost is allocated based on number of employees. The Custodial Services cost is allocated based on square feet of space occupied and the Maintenance cost is allocated based on machine-hours. Department Total Labor-Hours Square Feet of Space Occupied Number of Employees Machine-Hours Direct Labor-Hours Personnel 16,400 12,600 27 Custodial Services 8,600 3,900 49 Maintenance 14,300 10,200 65 Printing 30,600 40,300 109 162,000 13,000 Binding 101,000 21,000 307 41,000 80,000 170,900 88,000 557 203,000 93,000 Budgeted overhead costs in each department for the current year are shown below: Personnel $ 320,000 Custodial Services 65,300 Maintenance 93,300…
Houa Manufacturing has two support departments: Human Resources and Facilities. Houa has two production departments: Fabrication and Assembly. Actual data for each department is as follows: # Employees N/A | 250 Department Sq. Feet Human Resource 801 Facilities N/A Fabrication 750 5,073 Assembly 1,500 7,476 Human Resources costs equal $360,000 and are allocated based on the number (#) of Employees. Facilities costs equal $475,000 and are allocated based on Square (Sq.) Feet. Houa is determining the ranking of support department costs for the step-down allocation method and will use the percentage of services rendered to the support a departments. Calculate the percentage of support department services rendered to each other and rank the support department to be allocated first when using the step-down method. b. Independent of the answer in part b. and using the step-down method, calculate the allocation of support department costs to the production departments Fabrication and Assembly…
7
Extreme Manufacturing Company provides the following ABC costing information: Activities Total Costs Activity-cost drivers Account inquiry $320,000 16,000 hours Account billing $200,000 4,000,000 lines Account verification accounts $173,250 70,000 accounts Correspondence letters $24,000 4,000 letters Total costs $717,250 The above activities are used by Departments A and B as follows: Department A Department B Account inquiry hours 2,700 hours 4,200 hours Account billing lines 950,000 lines 750,000 lines Account verification accounts 8,500 accounts 6,500 accounts Correspondence letters 1,400 letters 1,800 letters How much of the account billing cost will be assigned to Department A? How much of the account verification accounts cost will be assigned to Department B?
provide correct answer please
The Hsu Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $536,250 are allocated on the basis of machine hours. The Accounting Department's costs of $151,200 are allocated on the basis of the number of employees within a specific department. The direct departmental costs for A and B are $240,000 and $440,000, respectively. Maintenance Accounting A B Machine hours 755 95 2,400 350 Number of employees 2 2 8 4 What is the Maintenance Department's cost allocated to Department A using the direct method? Multiple Choice $578,400. O $422,000. $284,000. $468,000.
University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each. The following data appear in the company records for the current period: Maintenance Personnel Printing Developing Machine-hours — 1,800 1,800 5,400 Labor-hours 650 — 650 2,600 Department direct costs $4,000 $14,000 $15,900 $12,600 Required: Use the direct method to allocate these service department costs to the operating departments. (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.) Maintenance Personnel Printing Developing service dept. costs maintenance allocation personnel allocation total cost allocation
Sequential (Step) Method of Support Department Cost Allocation Chekov Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments HumanResources GeneralFactory Fabricating Assembly Direct costs $165,000 $380,000 $114,200 $90,000 Normal activity: Number of employees — 40 70 150 Square footage 1,800 — 5,500 13,200 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Now assume that Chekov Company uses the sequential method to allocate support department costs. The support departments are ranked in order of highest cost to lowest cost. Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the sequential method. If an amount is zero, enter "0". Use the rounded…