Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 12, Problem 1E
LO 4-1 Exercise 4-1A Direct versus indirect costs
Ludmilla Construction Company is composed of two divisions: (1) Home Construction and (2) Commercial Construction. The Home Construction Division is in the process of building 12 houses and the Commercial Construction Division is working on three projects. Cost items of the company follow:
Wages of workers assigned to a specific construction project
Supplies used by the Commercial Construction Division
Labor on a particular house
Salary of the supervisor of commercial construction projects
Supplies, such as glue and nails, used by the Home Construction Division
Cost of building permits
Materials used in commercial construction projects
Depreciation on home building equipment (small tools such as hammers or saws)
Company president’s salary
Depreciation on crane used in commercial construction
Depreciation on home office building
Salary of corporate office manager
Required
- a. Identify each cost as being a direct or indirect cost assuming the cost objects are the individual products (houses or projects).
- b. Identify each cost as being a direct or indirect cost, assuming the cost objects are the two divisions.
- c. Identify each cost as being a direct or indirect cost assuming the cost object is Ludmilla Construction Company as a whole.
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Problem 2
ASD Company consists of two producing departments and two servicing Departments. The
following are the cost incurred in each department. The Company use the direct labor hours as
the basis for the overhead rate in the assembly department while units produced for the
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80,000
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6,000
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the departments while the Quality Inspection Department is based on units produced
Required
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Question 1
Fair Manufacturing Company is a factory in Hong Kong. It has two support departments- Maintenance and
Accounting and two operating departments – Production 1 and Production 2 Departments. You are given
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al 15 Chapter Four
Activity Cost Pool
Machining
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General factory
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Greenwood Company manufactures two products-13,000 units of Product Y and 5,000 units of Product Z. The
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8,800
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3,200
S
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Chapter 12 Solutions
Survey Of Accounting
Ch. 12 - 1.What is a cost object? Identify four different...Ch. 12 - Prob. 2QCh. 12 - 3.If the cost object is a manufactured product,...Ch. 12 - Prob. 4QCh. 12 - Prob. 5QCh. 12 - Prob. 6QCh. 12 - Prob. 7QCh. 12 - Prob. 8QCh. 12 - Prob. 9QCh. 12 - 10.Why are some manufacturing costs not directly...
Ch. 12 - Prob. 11QCh. 12 - 12.On January 31, the managers of Integra, Inc....Ch. 12 - 13.Respond to the following statement: The...Ch. 12 - Prob. 14QCh. 12 - Define the term cost pool. How are cost pools...Ch. 12 - LO 4-1Exercise 4-1A Direct versus indirect costs...Ch. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Exercise 4-4APooling overhead cost Ware...Ch. 12 - Prob. 5ECh. 12 - Exercise 4-5A Allocating overhead cost among...Ch. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Exercise 4-6AAllocating overhead costs among...Ch. 12 - Exercise 4-9AAllocating to solve a timing problem...Ch. 12 - Prob. 11ECh. 12 - Exercise 4-11AHow the allocation of fixed cost...Ch. 12 - Prob. 13ECh. 12 - Problem 4-17A Cost accumulation and allocation...Ch. 12 - Problem 4-18A Selecting an appropriate cost driver...Ch. 12 - Problem 4-19A Cost allocation in a service...Ch. 12 - Prob. 17PCh. 12 - Problem 4-21A Allocation to accomplish smoothing...Ch. 12 - Problem 4-22A Allocating indirect costs between...Ch. 12 - Prob. 20PCh. 12 - Prob. 1ATCCh. 12 - Prob. 2ATCCh. 12 - ATC 4-3 Research Assignment Using real-world data...Ch. 12 - Prob. 4ATCCh. 12 - Prob. 5ATC
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