Charlie’s Wood Works produces wood products (e.g., cabinets, tables, picture frames, and so on). Production departments include Cutting and Assembly. The Janitorial and Security departments support the Cutting and Assembly departments. The Assembly Department spans about 46,400 square feet and holds assets valued at about $60,000. The Cutting Department spans about 33,600 square feet and holds assets valued at about $140,000. Charlie’s Wood Works allocates support department costs using the direct method. If costs from the Janitorial Department are allocated based on square feet and costs from the Security Department are allocated based on asset value, determine (a) the percentage of Janitorial costs that should be allocated to the Assembly Department and (b) the percentage of Security costs that should be allocated to the Cutting Department.
Charlie’s Wood Works produces wood products (e.g., cabinets, tables, picture frames, and so on). Production departments include Cutting and Assembly. The Janitorial and Security departments support the Cutting and Assembly departments. The Assembly Department spans about 46,400 square feet and holds assets valued at about $60,000. The Cutting Department spans about 33,600 square feet and holds assets valued at about $140,000. Charlie’s Wood Works allocates support department costs using the direct method. If costs from the Janitorial Department are allocated based on square feet and costs from the Security Department are allocated based on asset value, determine (a) the percentage of Janitorial costs that should be allocated to the Assembly Department and (b) the percentage of Security costs that should be allocated to the Cutting Department.
Solution Summary: The author explains that cost allocation is the process of allocating the costs associated with the production of the products mainly indirectly and are generally ignored.
Charlie’s Wood Works produces wood products (e.g., cabinets, tables, picture frames, and so on). Production departments include Cutting and Assembly. The Janitorial and Security departments support the Cutting and Assembly departments. The Assembly Department spans about 46,400 square feet and holds assets valued at about $60,000. The Cutting Department spans about 33,600 square feet and holds assets valued at about $140,000. Charlie’s Wood Works allocates support department costs using the direct method. If costs from the Janitorial Department are allocated based on square feet and costs from the Security Department are allocated based on asset value, determine (a) the percentage of Janitorial costs that should be allocated to the Assembly Department and (b) the percentage of Security costs that should be allocated to the Cutting Department.
Determine the total manufacturing costs incurred during the financial year 2022
Nu Company reported the following pretax data for its first year of operations.
Net sales
2,800
Cost of goods available for sale
2,500
Operating expenses
880
Effective tax rate
25%
Ending inventories:
If LIFO is elected
820
If FIFO is elected
1,060
What is Nu's net income if it elects LIFO?
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