Question Viewer Daia - Support Divisions Human Information Corporate Operating Divisions Consumer Resources Systems Sales Sales Budgeted costs incurred before any interdivision cost allocations $ 70,000 $ 234,000 $ 992,000 $ 481,000 Support work supplied by human resources division Budgeted number of employees 20 48 32 Support work supplied by information systems division Budgeted processing time (in minutes) 330 - 1,830 1,500 Print Done × I-books, an online book retailer, has two operating divisions-corporate sales and consumer sales-and two support divisions-human resources and information systems. Each sales division conducts merchandising and marketing operations independently. I-books uses number of employees to allocate human resources costs and processing time to allocate information systems costs. The following data are available for September. View the data. Read the requirements. Requirement 1. Allocate the support divisions' costs to the operating divisions using the direct method. (Remember to round to seven decimals when calculating your percentages. Round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing divisions by allocating costs. Complete all answer boxes. For amounts with a $0 balance, make sure to enter "0" in the appropriate field.) Costs incurred $ Allocation of human resources costs Allocation of information systems costs Total budgeted costs of operating divisions Information Systems Support Divisions Human Resources 70,000 $ (70,000) Operating Divisions Corporate Sales Consumer Sales Total 234,000 $ 992,000 $ 481,000 $1,777,000 (234,000) 42,000 128,595 28,000 105,405 0 $ 0 $ 1,162,595 $ 614,405 $ 1,777,000 Requirement 2. Rank the support divisions based on the percentage of their services provided to other support divisions. Use this ranking to allocate the support divisions' costs to the operating divisions based on the step-down method. (Round percentages to seven decimal places.) Support division Human resources Percentage 20.000 9.0163934 Information systems Use this ranking to allocate the support divisions' costs to the operating divisions based on the step-down method. (Remember to round to seven decimals when calculating your percentages. Round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Complete all answer boxes. For amounts with a $0 balance, make sure to enter "0" in the appropriate field.) Support Division Human Information Resources Operating Division Systems Costs incurred S 70,000 $ Allocation of human resources costs (70,000) 33,600 Corporate Consumer Sales 234,000 $ 992,000 S 481,000 $1,777,000 14,000 22,400 Sales Total $ 0 Support Division Subtotal Allocation of information systems costs 248,000 (248,000) 136,288 111,712 0 $ 1,161,888 $ 615,112 $ 1,777,000 Total budgeted costs of operating divisions Requirement 3. How could you have ranked the support departments differently? You can rank the departments using an alternative approach-ranking based on the dollar amount of services rendered to other support divisions. Using numbers from requirement 2, calculate which department has the higher dollar amount allocated. (Remember to round to seven decimals when calculating your percentages and round the final answer to the nearest whole dollar.) What department should be allocated first? How much should be allocated to the first department? What department should be allocated second? How much should ha alleestad in the canned dansrimant

Question Viewer Daia - Support Divisions Human Information Corporate Operating Divisions Consumer Resources Systems Sales Sales Budgeted costs incurred before any interdivision cost allocations $ 70,000 $ 234,000 $ 992,000 $ 481,000 Support work supplied by human resources division Budgeted number of employees 20 48 32 Support work supplied by information systems division Budgeted processing time (in minutes) 330 - 1,830 1,500 Print Done × I-books, an online book retailer, has two operating divisions-corporate sales and consumer sales-and two support divisions-human resources and information systems. Each sales division conducts merchandising and marketing operations independently. I-books uses number of employees to allocate human resources costs and processing time to allocate information systems costs. The following data are available for September. View the data. Read the requirements. Requirement 1. Allocate the support divisions' costs to the operating divisions using the direct method. (Remember to round to seven decimals when calculating your percentages. Round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing divisions by allocating costs. Complete all answer boxes. For amounts with a $0 balance, make sure to enter "0" in the appropriate field.) Costs incurred $ Allocation of human resources costs Allocation of information systems costs Total budgeted costs of operating divisions Information Systems Support Divisions Human Resources 70,000 $ (70,000) Operating Divisions Corporate Sales Consumer Sales Total 234,000 $ 992,000 $ 481,000 $1,777,000 (234,000) 42,000 128,595 28,000 105,405 0 $ 0 $ 1,162,595 $ 614,405 $ 1,777,000 Requirement 2. Rank the support divisions based on the percentage of their services provided to other support divisions. Use this ranking to allocate the support divisions' costs to the operating divisions based on the step-down method. (Round percentages to seven decimal places.) Support division Human resources Percentage 20.000 9.0163934 Information systems Use this ranking to allocate the support divisions' costs to the operating divisions based on the step-down method. (Remember to round to seven decimals when calculating your percentages. Round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Complete all answer boxes. For amounts with a $0 balance, make sure to enter "0" in the appropriate field.) Support Division Human Information Resources Operating Division Systems Costs incurred S 70,000 $ Allocation of human resources costs (70,000) 33,600 Corporate Consumer Sales 234,000 $ 992,000 S 481,000 $1,777,000 14,000 22,400 Sales Total $ 0 Support Division Subtotal Allocation of information systems costs 248,000 (248,000) 136,288 111,712 0 $ 1,161,888 $ 615,112 $ 1,777,000 Total budgeted costs of operating divisions Requirement 3. How could you have ranked the support departments differently? You can rank the departments using an alternative approach-ranking based on the dollar amount of services rendered to other support divisions. Using numbers from requirement 2, calculate which department has the higher dollar amount allocated. (Remember to round to seven decimals when calculating your percentages and round the final answer to the nearest whole dollar.) What department should be allocated first? How much should be allocated to the first department? What department should be allocated second? How much should ha alleestad in the canned dansrimant

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter4: Job-order Costing And Overhead Application

Section: Chapter Questions

Problem 52E: (Appendix 4B) Sequential Method of Support Department Cost Allocation Refer to Exercise 4-51 for...

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