Managerial Accounting
Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
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Scuderi Corporation has two operating divisions-an Inland Division
and a Coast Division. The company's Customer Service Department
provides services to both divisions. The variable costs of the
Customer Service Department are budgeted at $37 per order. The
Customer Service Department's fixed costs are budgeted at
$434,000 for the year. The fixed costs of the Customer Service
Department are determined based on the peak period orders.
Percentage of peak period capacity Budgeted
required
Inland
Division
30%
Coast
70%
Division
orders
2,150
5,880
At the end of the year, actual Customer Service Department
variable costs totaled $303,958 and fixed costs totaled
$436,740.The Inland Division had a total of 2,180 orders and the
Coast Division had a total of 5,840 orders for the year.
Calculate the amount of the Customer Service Department's costs
that should be charged to each of the operating divisions at the end
of the year.
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Transcribed Image Text:Scuderi Corporation has two operating divisions-an Inland Division and a Coast Division. The company's Customer Service Department provides services to both divisions. The variable costs of the Customer Service Department are budgeted at $37 per order. The Customer Service Department's fixed costs are budgeted at $434,000 for the year. The fixed costs of the Customer Service Department are determined based on the peak period orders. Percentage of peak period capacity Budgeted required Inland Division 30% Coast 70% Division orders 2,150 5,880 At the end of the year, actual Customer Service Department variable costs totaled $303,958 and fixed costs totaled $436,740.The Inland Division had a total of 2,180 orders and the Coast Division had a total of 5,840 orders for the year. Calculate the amount of the Customer Service Department's costs that should be charged to each of the operating divisions at the end of the year.
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