PART 3 Betty's Book and Music Store has two service departments, Warehouse and Data Centre. Warehouse Department costs of $175,000 are allocated on the basis of budgeted warehouse-hours. Data Centre Department costs of $75,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $125,000 and $150,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Warehouse Production Departments Department Data Centre Department Music Books Budgeted costs $175,000 $75,000 $125,000 $150,000 Budgeted warehouse- NA 250 500 750 hours Number of computer hours 100 ΝΑ 400 500 Required: 1. Assign the support department costs to the production departments using: a. The Direct Method (3) b. The Step-Down Method assigning the Warehouse Department first (4) c. The Reciprocal Method using linear equations. (4)

PART 3 Betty's Book and Music Store has two service departments, Warehouse and Data Centre. Warehouse Department costs of $175,000 are allocated on the basis of budgeted warehouse-hours. Data Centre Department costs of $75,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $125,000 and $150,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Warehouse Production Departments Department Data Centre Department Music Books Budgeted costs $175,000 $75,000 $125,000 $150,000 Budgeted warehouse- NA 250 500 750 hours Number of computer hours 100 ΝΑ 400 500 Required: 1. Assign the support department costs to the production departments using: a. The Direct Method (3) b. The Step-Down Method assigning the Warehouse Department first (4) c. The Reciprocal Method using linear equations. (4)

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 2BE: Support department allocations The centralized computer technology department of Hardy Company has...

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Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $360,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of S180,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $135,000 and S162,000, respectively. Data on budgeted warehouse - hours and number f computer log - on hours are as follows: Support Departments Warehouse Department Production Departments Data Center Department Music Books Budgeted costs Budgeted warehouse - hours Number of computer hours $360,000 $180.000 $135,000 $162.000 NA 570 1,060 1,580 300 NA 830 1,100 Using the step - down method, what amount of Data Center Department cost will be allocated to the Warehouse Department if the service department with the highest percentage of interdepartmental support service is allocated first? (Round up) O A. $62,945 O B. $0 OC. $24,215 O D. $180,000
Support Department Allocations And Cost Drivers Varney Corporation, a manufacturer of electronics and communications systems, allocates Computing and Communications Services Department (CCS) costs to profit centers. The following table lists the types of services and cost drivers for each service. The table also includes the budgeted cost and quantity for each service for August. CCS Services Cost Drivers Budgeted Cost Budgeted Quantityof Services Help desk Number of calls $72,000 3,600 Network center Number of devices 168,000 2,000 Electronic mail Number of user accounts 166,500 4,500 Smartphone support Number of smartphones issued 131,200 4,100 One of the profit centers for Varney Corporation is the Communication Systems (COMM) division. Assume the following information for COMM: COMM has 3,500 employees, of whom 35% are office employees. All of the office employees have been issued a smartphone, and 96% of them have a computer on the network. Of the employees with a…
Question 5:Gold's Book and Music Store has two service departments, Warehouse and DataCenter. Warehouse Department costs of $350,000 are allocated on the basis ofbudgeted warehouse-hours. Data Center Department costs of $150,000 areallocated based on the number of computer log-on hours. The costs of operatingdepartments, Music and Books, are $250,000 and $300,000 respectively. Dataon budgeted warehouse-hours and number of computer log-on hours are asfollows:Support Departments Production DepartmentsWarehouseDepartmentData CenterDepartment Music BooksBudgeted costs $350,000 $150,000 $125,000 $150,000Budgeted warehousehoursNA 500 1,000 1,500Number of computerhours200 NA 800 1,000Answer the following questions using the information below:a) Using the direct method, what amount of Warehouse Department costs willbe allocated to both production departments - Music and Books?b) Using the direct method, what amount of Data Center Department costs willbe allocated to both production departments…
XYZ's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $280,000 are allocated based on budgeted warehouse-hours. Data Center Department costs of $80,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $90,000 and $108,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Budgeted costs Budgeted warehouse-hours O $122,500 Production Departments O $126,000 Number of computer hours 400 O $98,000 Warehouse Department O $98,000 $280,000 ΝΑ Data Center Department $80,000 500 ΝΑ Support Departments Music $90,000 1,125 900 Books Using the direct method, what amount of Warehouse Department costs will be allocated to Department Books? (Do not round any intermediary calculations.) $108,000 875 700
Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center Warehouse Department costs of $340,000 are allocated on the basis of budgeted warehouse-hours. Data Center Department costs of $140,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $120,000 and $144,000, respectively Data on budgeted warehouse-hours and number of computer log-on hours are as follows Support Departments OA. $77.778 OB. $62,222 OC. $140,000 OD. $55.495 Production Departments Music Books Warehouse Department Data Center Department Budgeted costs $340,000 $140,000 $120,000 Budgeted warehouse-hours 510 1,020 NA 240 Number of computer hours NA 880 Using the direct method. what amount of Data Center Department costs will be allocated to Department Music (Do not round any intermediary calculations) $144,000 1,570 1,100
Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $390,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of $100,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $122,500 and $147,000, respectively. Data on budgeted warehouse - hours and number of computer log - on hours are as follows: Support Departments Production Departments Warehouse Data Center Music Books Department $390,000 Department $100,000 Budgeted costs Budgeted warehouse - hours Number of computer hours $122,500 $147.000 NA 580 1,040 1,600 220 NA 810 1,010 Dr Using the step - down method, what amount of Data Center Department cost will be allocated to Department Music if the service department with the highest percentage of interdepartmental support service is allocated first? (Round intermediary calculations to three decimal places.) O A.…
Varney Corporation, a manufacturer of electronics and communications systems, allocates Computing and Communications Services Department (CCS) costs to profit centers. The following table lists the types of services and cost drivers for each service. The table also includes the budgeted cost and quantity for each service for August. CCS ServiceCategory Cost Drivers Budgeted Cost Budgeted Quantityof Services Help desk Number of calls $70,300 3,700 Network center Number of devices monitored 140,400 1,800 Electronic mail Number of user accounts 148,500 4,500 Smartphone support Number of smartphones issued 87,000 3,000 One of the profit centers for Varney Corporation is the Communication Systems (COMM) sector. Assume the following information for COMM: • COMM has 2,300 employees, of whom 25% are office employees. • All the office employees have been issued a smartphone, and 93% of them have a computer on the network. • Ninety percent of the employees with a…
Goldfarb's Book and Music Store has two service departments, Warehouse and Data Center. Warehouse Department costs of $300,000 are allocated on the basis of budgeted warehouse - hours. Data Center Department costs of $120,000 are allocated based on the number of computer log - on hours. The costs of operating departments Music and Books are $105,000 and $126,000, respectively. Data on budgeted warehouse - hours and number of computer log - on hours are as follows: Support Departments Production Departments Warehouse Data Center Music Books Department $300,000 Department $120,000 Budgeted costs Budgeted warehouse - hours Number of computer hours $105,000 1,060 $126,000 NA 560 1,520 210 NA 860 1,100 Using the step - down method, what amount of Warehouse Department cost will be allocated to Department Music if the service department with the highest percentage of interdepartmental support service is allocated first? (Do not round any intermediary calculations.) ..... O A. $35,446 O B.…
Varney Corporation, a manufacturer of electronics and communications systems, allocates Computing and Communications Services Department (CCS) costs to profit centers. The following table lists the types of services and cost drivers for each service. The table also includes the budgeted cost and quantity for each service for August. CCS ServiceCategory Cost Drivers Budgeted Cost Budgeted Quantityof Services Help desk Number of calls $50,400 2,800 Network center Number of devices monitored 170,100 2,100 Electronic mail Number of user accounts 151,700 4,100 Smartphone support Number of smartphones issued 115,600 3,400 One of the profit centers for Varney Corporation is the Communication Systems (COMM) sector. Assume the following information for COMM: • COMM has 2,400 employees, of whom 40% are office employees. • All the office employees have been issued a smartphone, and 92% of them have a computer on the network. • Ninety percent of the employees with a…
Middler Corporation, a manufacturer of electronics and communications systems, uses a service department charge system to charge profit centers with Computing and Communications Services (CCS) service department costs. The following table identifies an abbreviated list of service categories and activity bases used by the CCS department. The table also includes some assumed cost and activity base quantity information for each service for October. CCS ServiceCategory Activity Base Budgeted Cost Budgeted ActivityBase Quantity Help desk Number of calls $160,000 3,200 Network center Number of devices monitored 735,000 9,800 Electronic mail Number of user accounts 100,000 10,000 Handheld Technology support Number of handheld devices issued 124,600 8,900 One of the profit centers for Middler Corporation is the Communication Systems (COMM) sector. Assume the following information for the COMM sector: The sector has 5,200 employees, of whom 25% are office…
Betty's Book and Music Store has two service departments, Warehouse and Data Centre. Warehouse Department costs of $175,000 are allocated on the basis of budgeted warehouse-hours. Data Centre Department costs of $75,000 are allocated based on the number of computer log-on hours. The costs of operating departments Music and Books are $125,000 and $150,000, respectively. Data on budgeted warehouse-hours and number of computer log-on hours are as follows: Support Departments Production Departments Warehouse Department Data Centre Department Music Books Budgeted costs $175,000 $75,000 $125,000 $150,000 Budgeted warehouse-hours NA 250 500 750 Number of computer hours 100 NA 400 500 Required: Assign the support department costs to the production departments using: The Direct Method (3) The Step-Down Method assigning the Warehouse Department first (4) The Reciprocal Method using linear equations. (4)
Akagera Finance Plc has two service departments, the Human Resources (HR) Department and the Computing Department. Akagera Finance Plc has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows: User of Service Provider of Service HR Computing HR 0 10% Computing 10% 0 Deposit 55% 50% Loan 35% 40% The budgeted costs in the two service departments for the year are as follows: HR $ 529,000 Computing 758,500 Required: Use the reciprocal-services method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments