The Merchant Manufacturing Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below: FROM TO Purchasing Maintenance Fabrication Assembly Purchasing 0 % 60 % 30 % 10 % Maintenance 40 % 0 % 45 % 15 % The direct operating costs of the departments (including both variable and fixed costs) were as follows: Purchasing $ 129,000 Maintenance 51,000 Fabrication 105,000 Assembly 81,000 The total cost accumulated in the fabrication department using the direct method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
The Merchant Manufacturing Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below: FROM TO Purchasing Maintenance Fabrication Assembly Purchasing 0 % 60 % 30 % 10 % Maintenance 40 % 0 % 45 % 15 % The direct operating costs of the departments (including both variable and fixed costs) were as follows: Purchasing $ 129,000 Maintenance 51,000 Fabrication 105,000 Assembly 81,000 The total cost accumulated in the fabrication department using the direct method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The Merchant Manufacturing Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below:
| FROM | TO | |||||||||||
| Purchasing | Maintenance | Fabrication | Assembly | |||||||||
| Purchasing | 0 | % | 60 | % | 30 | % | 10 | % | ||||
| Maintenance | 40 | % | 0 | % | 45 | % | 15 | % | ||||
The direct operating costs of the departments (including both variable and fixed costs) were as follows:
| Purchasing | $ | 129,000 | |
| Maintenance | 51,000 | ||
| Fabrication | 105,000 | ||
| Assembly | 81,000 | ||
The total cost accumulated in the fabrication department using the direct method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
Multiple Choice
-
$240,000.
-
$167,400.
-
$273,750.
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$126,000.
-
$78,750.
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