Q1. Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of number of employees. Number of Square Feet Employees Support Departments: Maintenance 1,000 15 Personnel 1,000 8 Operating Departments: Riadh 5,000 12 Jeddah 6,000 18 Dammam 3,000 10 If the restaurant uses the direct method and the costs of Riyadh location, Jeddah location and Dammam location are $15,000, $12,000 and $10,000 respectively, calculate the total costs allocated to each restaurant location.
ANSWER:
Total Square feet :5000 +6000 +3000 = 14000
Total Number of employees = 12+18 + 10 = 40
Support department | Operating department | ||||
Maintenance | Personnel | Riyadh | Jeddah | Dammam | |
Direct cost | 25000 | 15000 | |||
Allocation of Maintenance department | (25000) | 8929 [25000*5000/14000] | 10714 [25000*6000/14000] | 5357 [25000*3000/14000] | |
Allocation of Personnel Department | (15000) | 4500 [15000*12/40] | 6750 [15000*18/40] | 3750 [15000*10/40] | |
Total cost allocated | 0 | 0 | 13429 | 17464 | 9107 |
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Q1. Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services...
Q1: Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of number of employees. Number of Square Feet Employees Support Departments: Maintenance 1,000 15 Personnel 1,000 8...
Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of number of employees. Number of Square Feet Employees Support Departments: Maintenance 1,000 15 Personnel 1,000 8 Operating Departments: Riadh 5,000 12 Jeddah 6,000 18 Dammam 3,000 10 If the restaurant uses the...
Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of number of employees. Number of Square Feet Employees Support Departments: Maintenance 1,000 15 Personnel 1,000 8 Operating...
topic:- Cost accounting * no hand writing *the answer must be unique not copied "plagiarized " Assignment Question(s): Q1. Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of...
topic:- Cost accounting * no hand writing *the answer must be unique not copied "plagiarized " Assignment Question(s): Q1. Spaghetti is a family-owned restaurant in KSA. The corporate office provides 2 kinds of services (maintenance and personnel) to 3 locations (Riyadh, Jeddah and Dammam). In a recent accounting period, the cost for maintenance was $25,000 and for personnel was $15,000. Maintenance costs are allocated on the basis of square feet, and personnel costs are allocated based on the basis of...
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