Stubing Company has two producing departments and two support centres. The following budgeted data pertain to these four departments: Maintenance and Personnel are the support centres and Assembly and Painting are the producing departments. Maintenance Personnel Assembly Painting Overhead $200,000 S60,000 $43,000 $74,000 5,400 5,400 Square footage 2,700 72 198 Employees 30 25,000 40,000 Direct labour hours Required () Allocate the overhead costs of the support departments to the producing departments using the reciprocal method Using direct labour hours compute departmental overhead rates
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- Russet Company has two service departments and two producing departments. Budgeted costs and budgeted activity in the various departments for the most recent year are presented below: Custodial Cutting Assembly Services Cafeteria Department DepartmentOverhead costs ......... P252,000 P140,000 P600,000 P900,000Square feet of space occupied ..... 1,000 2,000 8,000 10,000Number of employees .... 20 30…Westmore Company has two service departments and two operating departments. Budgeted costs and other data relating to these departments are presented below:Building Operating Department& Grounds Personnel A BDepartmental costs ..... $54,000 $200,000 $650,000 $800,000Square feet occupied ... 1,000 3,000 12,000 15,000Number of employees .... 10 5 45 55Direct laborhours ..... 76,000 92,000The costs of Building & Grounds are allocated first on the basis of square feet of space occupied. Personnel costs are allocated on the basis of numberof employees. The departmental costs for the operating departments are overhead costs. Predetermined overhead rates in the operating departments are computed on the basis of direct laborhours.Assume that the company uses the direct method of allocating service department costs. The predetermined overhead rate that would be used in Department B would be closest to:a. $11.50/DLH.b. $12.00/DLH.c. $10.00/DLH.d. $10.22/DLH.The following is the budgeted information of 3Z Company for the year 2021: Service Departments Producing Departments S1 S2 P1 P2 Budgeted overhead before distribution of service costs Direct labor hours Machine hours Number of employees Area occupied (sq ft) P300,000.00 P 150,000.00 P1,500,000.00 P750,000.00 6,000 45,400 25 30,000 33,250 5,000 150 50,000 13 8 4,200 1,500 Actual prime cost for the last quarter Of 2021 in the production of 15,000 units of Product MM is summarized below: P1 P2 11,250 hrs Direct labor hours 1,200 DLh @ P35 6,550 DLH @ P35 Machine hours 1,250 hrs Materials P75 per unit P5 per unit Additional information: • The company computes predetermined overhead rates based on machine hours in P1 and direct labor hours in P2, after distributing service costs using direct method. Sl costs are distributed based on area occupied and S2 costs are based on number of employees. Required: Compute for the total production costs of Product MM.
- The Document Creation Center (DCC) for Alegis Corp. provides photocopying and document services for three departments in the St. Paul office. The following budget has been prepared for the year. Available capacity Budgeted usage: Software Development Training Management Cost equation 13,000,000 pages 2,600,000 pages 4,875,000 pages 3,900,000 pages 55,000+ $0.03 per page If DCC uses a dual rate for allocating its costs based on usage, how much cost will be allocated to the Software Development Department?8. Adidas Inc. is exploring ways to allocate the cost of service departments such as Quality control and Maintenanceto the production departments such as Machining and assembly. The controller of the company has provided thefollowing information:QualityControl Maintenance Machining Assembly Total Budgetedoverhead costsbefore allocation P350,000 P200,000 P400,000 P300,000 P1,250,000 Budgetedmachine hours - - 50,000 hrs - 50,000 hrsBudgeted directlabor hours - - - 25,000 hrs 25,000 hrsBudgeted hoursof service ofquality control - 7,000 hrs 21,000 hrs 7,000 hrs 35,000 hrs Budgeted hoursof servicemaintenance 10,000 hrs - 18,000 hrs 12,000 hrs 40,000 hrs 1. Under direct method of allocating service department costs, what are the total service costs allocated tothe machining and assembly departments, respectively?a. 382,500 and 167,500b. 300,000 and 130,000c. 412,500 and 137,500d. 330,000 and 220,0002. Under the step-down method of allocating service department costs from quality control to…Budget Performance Report for a Cost CenterThe Eastern District of Adelson Inc. is organized as a cost center. The budget for the Eastern District of Adelson Inc. for themonth ended December 31 is as follows:Sales salaries $819,840System administration salaries 448,152Customer service salaries 152,600Billing salaries 98,760Maintenance 271,104Depreciation of plant and equipment 92,232Insurance and property taxes 41,280Total $1,923,968During December, the costs incurred in the Eastern District were as follows:Sales salaries $818,880System administration salaries 447,720Customer service salaries 183,120Billing salaries 98,100Maintenance 273,000Depreciation of plant and equipment 92,232Insurance and property taxes 41,400Total $1,954,452Required:1. Prepare a budget performance report for the manager of the Eastern District of Adelson for the month of December.Enter all amounts as positive numbers. If an amount box does not require an entry, leave it blank, or enter zero "0".
- Rafner Manufacturing identified the following budgeted data in its two production departments. Assembly Finishing Manufacturing overhead costs $ 1,120,800 $ 510,000 Direct labor hours 11,100 DLH 19,100 DLH Machine hours 5,100 MH 15,100 MH Required:What is the company’s assembly department overhead rate using direct labor hours?Fee Ltd makes four products, A, B, C and D, and has produced the following budgeted figures for the forthcoming period:A B C DDemand (units) 4,000 1,000 1,800 1,500Income K 40,000 20,000 27,000 38,400 Costs KMaterial 12,000 8,000 12,000 12,000Labour 12,000 6,000 8,000 15,000Variable Overhead 2,000 1,000 1,700 2,400Fixed Overhead 6,000 4,000 5,000 6,000Labour is paid at K10 per hour and is limited to 3,800 hours for the period. Materials are bought at K20 per kg and 2400 kgs of material is available.Required:(a) Find the limiting factor if the company wishes to produce the budgeted units as above. (b) Calculate and determine the order of profitability. (c) Calculate the production mix that will maximize profit for the period and the profit that will result if that mix is produced. (d) Calculate the increase in profit if an extra 150 units of the limiting factor are made available.Main Company has two service departments, Factory administration and Maintenance, and two operating departments, Cutting and Assembly. Selected budgeted information relating to these departments for the next year of operation is given below: Service department Operating Department Factory admin Maintenance Cutting Assembly Departmental costs R113 400 R80 000 R700 000 R600 000 Number of employees 3 5 40 60 Total labour hours 4 000 6 000 80 000 120 000 The company allocates service department costs by the step method. Factory administration costs are allocated first on the basis of number of employees and then Maintenance costs are allocated on the basis of total labour hours. The total Maintenance costs allocated to the Cutting Department is closest to: A. R31 068 B. R34 160 C. R32 000 D. R51 240