Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
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Chapter 5, Problem 3BE
a.
To determine
Compute the percentage of Janitorial costs that should be allocated to the Security Department by Company BT.
b.
To determine
Compute the percentage of Security costs that should be allocated to the Janitorial Department by Company BT.
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Support Department Cost Allocation-Reciprocal Services Method
Brewster Toymakers Inc. produces toys for children. The toys are produced in the Molding and Assembly departments, The Janitorial and Security departments support
the production of the toys. Costs from the Janitorial Department are allocated based on square feet. Costs from the Security Department are allocated based on asset
value. Relevant department information is provided in the following table:
Janitorial
Department
Security
Department
Molding
Department
Assembly
Department
Square feet
650
1,600
1,600
4,800
Asset value
$100
$120
$900
$1,000
Department cost
$2,000
$1,500
$10,900
$12,100
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Using the reciprocal services method of support department cost allocation, determine:
a. The percentage of Janitorial costs that should be allocated to the Security Department.
%
b. The percentage of Security costs that should be allocated to the Janitorial Department.
%
Brewster Toymakers Inc. produces toys for children. The toys are produced in the Molding andAssembly departments. The Janitorial and Security departments support the production of thetoys. Costs from the Janitorial Department are allocated based on square feet. Costs from theSecurity Department are allocated based on asset value. Relevant department information isprovided in the following table:
Using the reciprocal services method of support department cost allocation, determine(a) the percentage of Janitorial costs that should be allocated to the Security Departmentand(b) the percentage of Security costs that should be allocated to the Janitorial Department.
I need help with the following:
Support department cost allocation—reciprocal services method
Davis Snowflake & Co. produces Christmas stockings in its Cutting and Sewing departments. The Maintenance and Security departments support the production of the stockings. Costs from the Maintenance Department are allocated based on machine hours, and costs from the Security Department are allocated based on asset value. Information about each department is provided in the following table:
MaintenanceDepartment
SecurityDepartment
CuttingDepartment
SewingDepartment
Machine hours
800
2,000
6,400
11,600
Asset value
$2,000
$1,420
$1,500
$6,500
Department cost
$36,720
$16,320
$64,000
$84,000
Determine the total cost of each production department after allocating all support department costs to the production departments using the reciprocal services method.
CuttingDepartment
SewingDepartment…
Chapter 5 Solutions
Managerial Accounting
Ch. 5 - Why are support department costs difficult to...Ch. 5 - Why does support department cost allocation matter...Ch. 5 - What are some drawbacks of applying support...Ch. 5 - Why is the diect method of support department cost...Ch. 5 - How does management determine the order in which...Ch. 5 - Are large or small companies more likely to use...Ch. 5 - What is the main difference between the physical...Ch. 5 - When would management most likely use the net...Ch. 5 - What are the two most often used ways of...Ch. 5 - How can support department and joint cost...
Ch. 5 - Charlies Wood Works produces wood products (e.g.,...Ch. 5 - Bucknum Boys, Inc., produces hunting gear for buck...Ch. 5 - Prob. 3BECh. 5 - Blakes Blacksmith Co. produces two types of...Ch. 5 - Garys Grooves Co. produces two types of carving...Ch. 5 - Prob. 6BECh. 5 - Yo-Down Inc. produces yogurt. Information related...Ch. 5 - Prob. 2ECh. 5 - Blue Africa Inc. produces laptops and desktop...Ch. 5 - Christmas Timber, Inc., produces Christmas trees....Ch. 5 - Crystal Scarves Co. produces winter scarves. The...Ch. 5 - Davis Snowflake Co. produces Christmas stockings...Ch. 5 - Prob. 7ECh. 5 - Prob. 8ECh. 5 - Prob. 9ECh. 5 - Support department cost allocation comparison...Ch. 5 - Prob. 11ECh. 5 - Prob. 12ECh. 5 - Joint cost allocation market value at split-off...Ch. 5 - Joint cost allocation net realizable value method...Ch. 5 - Prob. 15ECh. 5 - Prob. 16ECh. 5 - Joint cost allocation-market value at split-off...Ch. 5 - Joint cost allocation net realizable value method...Ch. 5 - Support department cost allocation Blue Mountain...Ch. 5 - Support activity cost allocation Jakes Gems mines...Ch. 5 - Joint cost allocation Lovely Lotion Inc. produces...Ch. 5 - Joint cost allocation Florissas Flowers jointly...Ch. 5 - Support department cost allocation Hooligan...Ch. 5 - Support activity cost allocation Kizzles Crepes...Ch. 5 - Joint cost allocation McKenzies Soap Sensations,...Ch. 5 - Prob. 4PBCh. 5 - Analyze Milkrageous, Inc. Milkragcous, Inc., a...Ch. 5 - Analyze Horsepower Hookup, Inc. Horsepower Hookup,...Ch. 5 - Prob. 3MADCh. 5 - Prob. 4MADCh. 5 - Joint cost allocation and performance evaluation...Ch. 5 - Prob. 3TIFCh. 5 - Prob. 1CMACh. 5 - Adam Corporation manufactures computer tables and...Ch. 5 - Breegle Company produces three products (B-40,...Ch. 5 - Tucariz Company processes Duo into two joint...
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