• Vこの* COFL今4Check my wModel, Inc., produces model automobiles made from metal. It operates two production departments, Molding and Painting, and hasthree service departments, Administration, Accounting, and Maintenance. The accumulated costs in the three service departmentswere $265,000, $420,000, and $207,000, respectively. Management is concerned that the costs of its service departments aregetting too high. In particular, managers would like to keep the costs of service departments under $3.50 per unit on average. Youhave been asked to allocate service department costs to the two production departments and compute the unit costs.The company decided that Administration costs should be allocated on the basis of square footage used by each production andservice department. Accounting costs are allocated on the basis of number of employees. Maintenance costs are allocated on thebasis of the dollar value of the equipment in each department. The use of each base by all departments during the current periodfollows.Used byAccounting MaintenanceAllocation BaseBuilding areaEmployeesEquipment value (in thousands)AdministrationMolding432,00092Painting000'9123$ 228.0069$114.00$57.00$171.00$ 16. 50Direct costs of the Molding Department included $230,000 in direct materials, $345,000 in direct labor, and $117,500 in overhead. ThePainting Department's direct costs consisted of $206,000 in direct materials, $174,000 in direct labor, and $80,000 in overhead.Required:a. Using the step method, determine the allocated costs and the total costs in each of the two producing departments. Ignore self-usage (for example, ignore work done by Administration for itself). Rank order the allocation as follows: (1) Maintenance, (2)Accounting, and (3) Administration.b. Assume that 100,000 units were processed through these two departments. What is the unit cost for the sum of direct materials,direct labor, and overhead (1) for Molding, (2) for Painting, and (3) in total?< Prev4 of 4here to searchDeleteNO+DIna&%23%97.H.B.AltAltCtrl

Direct Cost - Direct costs are expenses that may be traced back to a specific cost object. The…

ates two production departments, Molding and Painting, and has nance. The accumulated costs in the three service departments ent is concerned that the costs of its service departments are s of service departments under $3.50 per unit on average. You roduction departments and compute the unit costs. d on the basis of square footage used by each production and number of employees. Maintenance costs are allocated on the use of each base by all departments during the current period ing 30 16 30 Used by Maintenance Molding 54,000 432,000 46 $ 16.50 92 $ 228.00 t materials, $345,000 in direct labor, and $117,500 in overhead. The materials, $174,000 in direct labor, and $80,000 in overhead. of 4 Painting 72,000 69 $114.00 tal costs in each of the two producing departments. Ignore self- Rank order the allocation as follows: (1) Maintenance, (2) epartments. What is the unit cost for the sum of direct materials, total? Next >

ates two production departments, Molding and Painting, and has nance. The accumulated costs in the three service departments ent is concerned that the costs of its service departments are s of service departments under $3.50 per unit on average. You roduction departments and compute the unit costs. d on the basis of square footage used by each production and number of employees. Maintenance costs are allocated on the use of each base by all departments during the current period ing 30 16 30 Used by Maintenance Molding 54,000 432,000 46 $ 16.50 92 $ 228.00 t materials, $345,000 in direct labor, and $117,500 in overhead. The materials, $174,000 in direct labor, and $80,000 in overhead. of 4 Painting 72,000 69 $114.00 tal costs in each of the two producing departments. Ignore self- Rank order the allocation as follows: (1) Maintenance, (2) epartments. What is the unit cost for the sum of direct materials, total? Next >

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

Subject: Cost AccountingPlease answer the given questions. Thank you!
Barrington Box Enterprises has two divisions, large and small, that share the common costs of the company's communications network. The annual common costs are $4,800,000. You have been provided with the following information for the upcoming year: Large Small Calls 150,000 90,000 The cost accountant determined $2,760,000 of the communication network's costs were fixed and should be allocated based on the number of calls. The remaining costs should be allocated based on the time on the network. What is the total communication network costs allocated to the Large Box Division, assuming the company uses dual-rates to allocate common costs? Multiple Choice $2,760,000 $2,259,000 $2,541,000 Time on Network (hours) 160,000 240,000 $1,640,000
Two products were produced for a customer, Product A and Product B. Product A GHS Product B GHS Direct material costs 300,000 350,000 Direct labour costs 400,000 270,000 Direct labour hours: Assembly Department Welding Department Finishing Department Hrs 1,000 1,500 750 Hrs 950 800 1,000 Required: i. Calculate the full cost for each product. ii. What will be the selling price each to make a profit of 40% on cost?
Rabia Company has two support departments, Human Resources and Maintenance, and two producing departments, Fabrication and Assembly Support Departments Producing Departments Human Resources Maintenance Fabrication Assembly Budgeted overhead Direct labor hours Machine hours Number of employees $40,000 $72,000 $140,000 $160,000 2,000 2,500 8,000 10,000 12,000 8,000 4 5 15 25 The company only had mixed cost. Human Resource costs are allocated based on the number of employees, and maintenance costs are allocated based on machine hours. Predetermined overhead rates for fabrication and assembly are based on direct labor hours. Required: 1. Calculate the allocation ratios. 2. Using the direct method, allocate the costs of the Human Resources and Maintenance deportments to the Fabrication and Assembly departments. Also write the final cost of both the production departments. 3. What if the Maintenance Department had 50 employees? How would that affect the allocation of Human Resources…
FUT manufactures two products.. Both products require manufacturing operations in two departments: Product 1 2 Profit/Unit $25 $20 Labour Hours Dept. A 6 8 Labour Hours Dept. B 12 10 For the coming production period, FUT has available 900 hours of labor that can be allocated to either of the two departments. Find the production plan and labor allocation (hours assigned in each department) that will maximize profit. (Use Excel Solver)
Mighty Inc. operates an automobile services facility. The following table shows the costs incurred during a month Produced Units 2000 units 4000 units Total costs: Fixed costs 10000 10000 Variable costs A 29000. Required: Find the value of A
ABD Company's manufacturing overhead is 60% of its total conversion costs. If direct labor is PhP1,750,000 and if direct materials are PhP2,750,000, what is the manufacturing overhead? Show the solution.