Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base. Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

Question

Want to see the full answer?

Answer 1

Question

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Purchases Transactions Barans Company purchased merchandise on account from a supplier for $9,200, terms 2/10, n/30. Barans Company returned $1,700 of the merchandise and received full credit. a. If Barans Company pays the invoice within the discount period, what is the amount of cash required for the payment? b. What account is credited by Barans Company to record the return? Merchandise Inventory Feedback Check My Work (a) The return of merchandise reduces the original invoice amount to be paid. The discount is taken on the amount owed on the merchandise after the return. (b) Any discounts or returns are recorded directly by the buyer who reduces the balances of Accounts Payable and Merchandise Inventory, using a debit memo based on the net cost of the merchandise. 9:04 P 10/20/2 %23 近

Prepare journal entries for the following merchandising transactions of Dollar Store assuming it uses a perpetual inventory system and the gross method. Nov. 1 Dollar Store purchases merchandise for $1,500 on terms of 2∕5, n∕30, FOB shipping point, invoice dated November 1. 5 Dollar Store pays cash for the November 1 purchase. 7 Dollar Store discovers and returns $200 of defective merchandise purchased on November 1, and paid for on November 5, for a cash refund. 10 Dollar Store pays $90 cash for transportation costs for the November 1 purchase. 13 Dollar Store sells merchandise for $1,600 with terms n∕30. The cost of the merchandise is $800. 16 Merchandise is returned to the Dollar Store from the November 13 transaction. The returned items are priced at $160 and cost $80; the items were not damaged and were returned to inventory.

Sales transactionsJournalize the following merchandise transactions:a. Sold merchandise on account, $18,000 with terms 1/10, n/30. The cost of the goods sold was $10,800.b. Received payment less the discount.c. Refunded $600 to customer for defective merchandise that was not returned.

Answer 2

Question

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Answer 6

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

Answer 7

Chapter 5, Problem 13QS

1.

To determine

Introduction:

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

Allocation of the service department’s cost to the consuming department and the predetermined overhead rates in the operating department

Answer 8

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

Answer 9

2.

To determine

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

Answer 10

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

Answer 11

3.

a.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

Answer 12

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Answer 13

3.

b.

To determine

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The reason the step-down method is a better base for computing the predetermined rates than the direct method.

Answer 14

Expert Solution & Answer

Answer 15

Expert Solution & Answer

Answer 16

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 17

Ch. 5 - Applying merchandising terms C1 P1 Enter the...Ch. 5 - Identifying inventory costs C2 Costs of $5.000...Ch. 5 - Merchandise accounts and computations C2 Use the...Ch. 5 - Computing net invoice amounts P1 Compute the...Ch. 5 - Recording purchases, returns, and discounts taken...Ch. 5 - Recording purchases and discounts taken P1 Prepare...Ch. 5 - Recording purchases and discounts missed Pl...Ch. 5 - Prob. 8QS Ch. 5 - Prob. 9QS Ch. 5 - Prob. 10QS

Introduction: Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department. Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base. The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.

Want to see the full answer?

Chapter 5 Solutions

Introduction:

Direct method: Under the direct method, the overhead costs incurred by the supporting department are directly allocated to the operating department.

Allocation of the service department’s cost to the consuming department using the direct method and the predetermined overhead rate.

Step-down method: The overhead costs of supporting incurred by the supporting department are allocated to other supporting departments and also the operating department based on the allocation base.

The amount of overhead cost for the job using overhead rates computed in parts 1 and 2.