Accounting
27th Edition
ISBN: 9781337514071
Author: WARREN
Publisher: Cengage
expand_more
expand_more
format_list_bulleted
Question
Chapter 24, Problem 3DQ
To determine
Service department charges: These are the indirect expenses incurred by profit center. These are charged for the services received by the department or division, based on the activity base of the service department.
To identify: The activity base of the given service department
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Weyerhaeuser developed a system that assigns service department expenses to user divisions on the basis of actual services consumed by the division. Here are a number of Weyerhaeuser's activities in its central Financial Services Department:
Payroll
Accounts payable
Accounts receivable
Database administration—report preparation
For each activity, identify an activity base that could be used to charge user divisions for service.
Identify an activity base that could be used to charge user divisions for services for each actitivity.
Payroll
Accounts Payable
Accounts Receivable
Database Administration-report preparation
The accounting and finance department performs processes such as creating financial statements, paying accounts payables, and collecting accounts receivables. What form of processes do these represent? Customer-facing processes Business-facing processes Industry-specific customer-facing processes All of these
Chapter 24 Solutions
Accounting
Ch. 24 - Differentiate between centralized and...Ch. 24 - Differentiate between a profit center and an...Ch. 24 - Prob. 3DQCh. 24 - What is the major shortcoming of using income from...Ch. 24 - In a decentralized company in which the divisions...Ch. 24 - How does using the return on investment facilitate...Ch. 24 - Why would a firm use a balanced scorecard in...Ch. 24 - What is the objective of transfer pricing?Ch. 24 - When is the negotiated price approach preferred...Ch. 24 - When using the negotiated price approach to...
Ch. 24 - Budgetary performance for cost center Caroline...Ch. 24 - Budgetary performance for cost center Conley...Ch. 24 - Service department charges The centralized...Ch. 24 - Service department charges The centralized...Ch. 24 - Prob. 24.3APECh. 24 - Income from operations for profit center Using the...Ch. 24 - Profit margin, investment turnover, and ROI Cash...Ch. 24 - Profit margin, investment turnover and ROI Briggs...Ch. 24 - Residual income The Consumer Division of Galena...Ch. 24 - Residual income The Commercial Division of Herring...Ch. 24 - Transfer pricing The materials used by the North...Ch. 24 - Transfer pricing The materials used by the...Ch. 24 - Budget performance reports for cost centers...Ch. 24 - Divisional income statements The following data...Ch. 24 - Prob. 24.3EXCh. 24 - Prob. 24.4EXCh. 24 - Service department charges In divisional income...Ch. 24 - Service department charges and activity bases...Ch. 24 - Divisional income statements with service...Ch. 24 - Corrections to service department charges for a...Ch. 24 - Profit center responsibility reporting Glades...Ch. 24 - Return on investment The income from operations...Ch. 24 - Residual income Based on the data in Exercise...Ch. 24 - Determining missing items in return computation...Ch. 24 - Profit margin, investment turnover, and return on...Ch. 24 - Prob. 24.14EXCh. 24 - Determining missing items in return and residual...Ch. 24 - Determining missing items from computations Data...Ch. 24 - Prob. 24.17EXCh. 24 - Balanced scorecard for a service company American...Ch. 24 - Building a balanced scorecard Hit-n-Kun Inc. owns...Ch. 24 - Prob. 24.20EXCh. 24 - Prob. 24.21EXCh. 24 - Budget performance report for a cost center...Ch. 24 - Profit center responsibility reporting for a...Ch. 24 - Divisional income statements and return on...Ch. 24 - Effect of proposals on divisional performance A...Ch. 24 - Divisional performance analysis and evaluation The...Ch. 24 - Prob. 24.6APRCh. 24 - Budget performance report for a cost center The...Ch. 24 - Profit center responsibility reporting for a...Ch. 24 - Divisional income statements and return on...Ch. 24 - Effect of proposals on divisional performance A...Ch. 24 - Divisional performance analysis and evaluation The...Ch. 24 - Prob. 24.6BPRCh. 24 - Prob. 24.1CPCh. 24 - Prob. 24.3CPCh. 24 - Prob. 24.4CPCh. 24 - Evaluating divisional performance The three...Ch. 24 - Evaluating division performance Last Resort...
Knowledge Booster
Similar questions
- For each of the following support departments, identify a cost driver that could be used for allocating the support department costs to the profit center: a. Legal b. Duplication services c. Electronic data processing d. Central purchasing e. Telecommunications f. Accounts receivablearrow_forwardBaldwin Enterprises has two service departments, Personnel and Legal, and two operating divisions, Eastern and Western. Personnel costs are allocated on the basis of employees and Legal costs are allocated on the basis of hours. A summary of Baldwin operations follows: Employees Hours Department direct costs Required A Complete this question by entering your answers in the tabs below. Department costs Personnel allocation Legal allocation Total costs Costs Department costs Legal allocation Personnel allocation Total costs Personnel Required B Required C Legal Required: a. Allocate the cost of the service departments to the operating divisions using the direct method. b. Allocate the cost of the service departments to the operating divisions using the step method. Start with Legal. c. Allocate the cost of the service departments to the operating divisions using the reciprocal method. From Total Allocate the cost of the service departments to the operating divisions using the direct…arrow_forwardWhen you look at the organizational structure of ABC Inc., you notice that the Marketing department is divided into communications, event planning, marketing, and web content. You also see that the Accounting department has separate units for accounts payable and accounts receivable. ABC Inc. uses ________ departmentalization. Question 9 options: A) product B) geographic C) functional D) customer E) processarrow_forward
- The scenario describes a task undertaken by Adam, the managing partner at Novak Accounting Services (NAS), who is assessing the profitability of the firm’s three operational divisions: Audit, Tax, and Advisory Services. These divisions receive support from three separate departments: Billing, Human Resources (HR), and IT. Each support department incurs specific costs and serves the operating divisions based on distinct cost drivers or allocation bases. Here are the details: •The Billing Department has incurred original costs of $66,000 but does not record any specific billing hours used by the operating divisions. •The Human Resources Department has expenses amounting to $113,000 and houses two employees. •The IT Department shows costs of $98,000 and has its services measured in hours used by various departments, totaling 200 hours for itself and distributing additional hours to the operating divisions—900 hours to Audit, 600 hours to Tax, and 300 hours to Advisory. For the…arrow_forwardFor each office or business segment, indicate which type of Responsibility Center it is: a. A retail location, such as the Apple Store b. A manufacturing division that manages its own facilities and production equipment c. Call center for a warranty claims processing d. Consulting department of an accounting firm e. Quality control department for a golf ball manufacturer PreviousNextarrow_forwardManning Systems is a commercial software vendor that sells billing and other financial software to companies around the globe. Manning operates a centralized call center for customer support calls. Costs associated with use of the center are charged to the division with primary responsibility for the client. There are four geographical divisions: North America (NA), Central and South America (SA), Europe, and Asia-Pacific (APAC). The allocation is based on the length of time of calls made (Minutes). Idle time of the reservation agents and the fixed cost of the equipment are allocated based on the number of calls received (Calls) from clients in each division. Due to recent increased competition in the commercial software business, Manning has decided that it is necessary to better allocate its costs in order to price its services competitively and profitably. During the most recent period for which data are available, the use of the call center for each division was as follows:…arrow_forward
- please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image)arrow_forwardA system that establishes financial accountability for operating segments within an organization is called _______. A. a financial statement B. an internal control system C. responsibility accounting D. centralizationarrow_forwardClassify which area in the organization these functions belong: Finance, Accounting, Marketing, Production Quality Control Sales Order Entry Credit Evaluation Cash Disbursement Promotion Maintenance Manufacturing Billing General Ledger Cash Receiptsarrow_forward
- Do not use chatgptarrow_forwarddetermine most important cost drivers for each department of a project-based cunstruction company: 1. Human Resource Management Department (for cost pools such as Recruiting, Acquisition, Formal Training, Informal Training, Development, etc) 2. Legal Department (for Employer contracts, legal, claims, etc) 3. Financing Department 4. Business Developement 5. Accounting and finance Department 6. Organizational Excellence Management Department (for risk, strategy, budget, performance planning and controlling) 7. HSE and Quality Department 8. CEO office 9. Deputy for Planning and Executive Coordination 10. Stock affairs, corporate affairs and corporate oversightarrow_forwardWhich General Staff member negotiates and monitors contracts, maintains documentation for reimbursement, and oversees timekeeping for incident personnel? A.Finance/Administration Section Chief B. Operations Section Chief C. Logistics Section Chief D. Planning Section Chief.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Pkg Acc Infor Systems MS VISIO CDFinanceISBN:9781133935940Author:Ulric J. GelinasPublisher:CENGAGE L
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Pkg Acc Infor Systems MS VISIO CD
Finance
ISBN:9781133935940
Author:Ulric J. Gelinas
Publisher:CENGAGE L
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,