Support Department Cost Allocation—Direct Method Christmas Timber, Inc., produces Christmas trees. The trees are produced through a cutting and pruning process. Machine maintenance and janitorial labors are performed throughout the production process by nonproduction employees. Maintenance and janitorial costs are allocated based on machine hours used and the number of trees in each department, respectively. The company estimates that the cutting and pruning areas typically have about 20 and 60 trees, respectively, in them at one time. The company also estimates that the cutting process requires about 9 times as many machine hours as the pruning process. The total costs of each department are as follows: Maintenance Department $7,800 Janitorial Department 5,000 Cutting Department 54,500 Pruning Department 11,000 Using the direct method of support department cost allocation, determine the total cost of each production department after allocating all support costs to the production departments. CuttingDepartment PruningDepartment Production departmentsʼ total costs $fill in the blank 1 $fill in the blank 2

Support Department Cost Allocation—Direct Method Christmas Timber, Inc., produces Christmas trees. The trees are produced through a cutting and pruning process. Machine maintenance and janitorial labors are performed throughout the production process by nonproduction employees. Maintenance and janitorial costs are allocated based on machine hours used and the number of trees in each department, respectively. The company estimates that the cutting and pruning areas typically have about 20 and 60 trees, respectively, in them at one time. The company also estimates that the cutting process requires about 9 times as many machine hours as the pruning process. The total costs of each department are as follows: Maintenance Department $7,800 Janitorial Department 5,000 Cutting Department 54,500 Pruning Department 11,000 Using the direct method of support department cost allocation, determine the total cost of each production department after allocating all support costs to the production departments. CuttingDepartment PruningDepartment Production departmentsʼ total costs $fill in the blank 1 $fill in the blank 2

Holt Mcdougal Larson Pre-algebra: Student Edition 2012

1st Edition

ISBN:9780547587776

Author:HOLT MCDOUGAL

Publisher:HOLT MCDOUGAL

ChapterCSR: Contents Of Student Resources

Section: Chapter Questions

Problem 7.30EP

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