labor distribution based on equal distribution among the departments.

Company has two production departments; Cutting and Painting, and two service departments Maintenance and design which directly support two production departments. The first level overhead costs of these departments are as follows. Cutting Painting $400,000 Design 640,000 Maintenance 96,000 500,000 The following schedule reflects the use of the Maintenance and Design Departments' output by other departments: Maintenance Maintenance (hours) Design (minutes) 240,000 0 Design 1,000 0 Cutting 1,000 his 840,000 Painting 8,000 120,000 Required 1. Allocate service departments cost to production departments by using direct method and step-down method.

Mack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair and Quality Control. Direct costs for each department and the proportion of service costs used by the various departments for the month of March follow: Proportion of Services Used by Department Fabricating Direct Costs Repair $ 132,600 Quality Control Fabricating Finishing Finishing 94,200 Repair 40,200 0 0.2 0.5 0.3 Quality Control 75,000 0.8 0 0.1 0.1 Required: Use the step method to allocate the service costs, using the following: a. The order of allocation starts with Repair. b. The allocations are made in the reverse order (starting with Quality Control).

.

Rollins Company manufactures two products—S500 and T750. The company provided the following information with respect to these products:   S500 T750 Estimated customer demand (in units) 5,600 4,000 Selling price per unit $ 2,400 $ 4,200 Variable expense per unit $ 1,400 $ 2,400 The company has four manufacturing departments—Fabrication, Molding, Machining, and Assemble & Pack. The capacity available in each department (in hours) and the demands that one unit of each of the company’s products makes on those departments is as follows:   S500 (hours per unit) T750 (hours per unit) Capacity (in hours) Fabrication 1 2 4,000 Molding 2 2 6,000 Machining 2 0 5,000 Assemble & Pack 0 3 4,500 The company is trying to decide what product mix will maximize profits. Given that its fixed costs will not change regardless of the chosen mix, the company plans to identify the product mix that maximizes its total contribution margin. Assume the company focuses solely…

The Aleutian Company produces two products, Rings and Dings. They are manufactured in two departments-Fabrication and Assembly. Data for the products and departments are listed below. Product Rings Dings Number of Units 1,150 1,740 $43.11 $52.42 $58.49 $7.49 Labor Hours Per Unit 4 Machine Hours Per Unit 8 11 All of the machine hours take place in the Fabrication Department, which has an estimated overhead of $86,000. All of the labor hours take place in the Assembly Department, which has an estimated total overhead of $65,500. The Aleutian Company uses departmental overhead rates. The Fabrication Department uses machine hours for an allocation base, and the Assembly Department uses labor hours. What is the overhead cost per unit for Rings?

Honeywell Industries has the following overhead costs and cost drivers. Direct labor hours are estimated at 100,000 for the year. Activity Cost Pool Ordering and Receiving Machine Setup Machining Assembly Inspection $0.22 Cost Driver Orders Setups Machine hours $1.34 $1.86 $0.47 Parts Inspections Estimated Overhead $21,500 $31,100 $46,500 $51,600 $35,400 Cost Driver Activity. 500 orders 450 setups 125,000 hours 1,000,000 parts Overhead is applied using traditional costing based on direct labor hours. What is the overhead application rate? 500 inspections 45

Mack Precision Tool and Die has two production departments, Fabricating and Finishing, and two service departments, Repair and Quality Control. Direct costs for each department and the proportion of service costs used by the various departments for the month of March follow: Proportion of Services Used by Department Fabricating Direct Costs Repair $ 134,600 Quality Control Fabricating Finishing Finishing 98,200 Repair Quality Control 42,000 78,400 0 0.2 0.5 0.3 0.6 0 0.2 0.2 Required: Use the step method to allocate the service costs, using the following: a. The order of allocation starts with Repair. b. The allocations are made in the reverse order (starting with Quality Control). Complete this question by entering your answers in the tabs below. Required A Required B Use the step method to allocate the service costs, using the following: The allocations are made in the reverse order (starting with Quality Control). Note: Amounts to be deducted should be indicated by a minus sign. Do…

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.

Vinubhai