Homework Answers
Solution:
- The answer is (c) The sequential method.
Explanation:
The sequential allocation method might be more exact than the direct method since it perceives a few interactions among the support departments.
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Identify the method of allocation in which the costs allocated from a support department are its...
Which of the following statements explains the major difference between the sequential method and the direct...
Which of the following statements explains the major difference between the sequential method and the direct method? Under the direct method, the total support department costs to be allocated will also include any costs that were allocated to that support department from other support departments. Under the sequential method, the total support department costs to be allocated will never include any costs that were allocated to that support department from other support departments. Under the sequential method, every support department...
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating...
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating divisions: Battery and Small Motors. The company allocates power and general factory costs to each operating division using the sequential method. General Factory is allocated first in the sequential method for the company. Support department cost allocations using the sequential method are based on the following data: Support Departments Operating Divisions Power General Factory Battery Small Motors Overhead costs $160,000 $430,000 $163,000 $84,600 Machine...
Which of the following is true? Cost allocation is a way to distribute costs from support...
Which of the following is true? Cost allocation is a way to distribute costs from support departments to revenue-producing departments. In the step-down cost-allocation method, the order which support areas are allocated can affect the organization's total costs. In the step-down method, the indirect department that receives the least amount of service from other indirect departments and provides the most service to other departments allocates its cost last. All of them are false
Support department cost allocation Blue Mountain Masterpieces produces pictures, paintings, and other home decor. The Printing...
Support department cost allocation Blue Mountain Masterpieces produces pictures, paintings, and other home decor. The Printing and Framing production departments are supported by the Janitorial and Security departments. Janitorial costs are allocated to the production departments based on square feet, and security costs are allocated based on asset value. Information about these departments is detailed in the following table: Janitorial Department Security Department Printing Department Framing Department Square feet 760 1,040 4,230 4,770 Asset value $900 $1,240...
Support department cost allocation—comparison Becker Tabletops has two support departments ( Janitorial and Cafeteria) a...
Support department cost allocation—comparison Becker Tabletops has two support departments ( Janitorial and Cafeteria) and two production departments (Cutting and Assembly). Relevant details for these departments are as follows: Support Department Cost Driver Janitorial Department Square footage to be serviced Cafeteria Department Number of employees Janitorial Department Cafeteria Department Cutting Department Assembly Department Department costs $310,000 $169,000 $1,504,000 $680,000 Square feet 50 5,000 1,000 4,000 Number of employees 10 3 30 10 Allocated the support department costs to the production...
Support department cost allocation—comparison Becker Tabletops has two support departments ( Janitorial and Cafeteria) and two...
Support department cost allocation—comparison Becker Tabletops has two support departments ( Janitorial and Cafeteria) and two production departments (Cutting and Assembly). Relevant details for these departments are as follows: Support Department Cost Driver Janitorial Department Square footage to be serviced Cafeteria Department Number of employees Janitorial Department Cafeteria Department Cutting Department Assembly Department Department costs $310,000 $169,000 $1,504,000 $680,000 Square feet 50 5,000 1,000 4,000 Number of employees 10 3 30 10 Allocated the support department...
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating...
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating divisions: Battery and Small Motors. The company allocates power and general factory costs to each operating division using the sequential method. General Factory is allocated first in the sequential method for the company. Support department cost allocations using the sequential method are based on the following data: Support Departments Operating Divisions General Factory Small Motors Power Battery Overhead costs $430,000 $84,600 $160,000 2,000 $163,000...
Which of the following statements is true about the sequential method of allocating support department costs...
Which of the following statements is true about the sequential method of allocating support department costs to production departments? a. The sequential method captures some but not all the inter-support-department services by allocating support departments to other support departments and production departments in a series of steps. b. The sequential method is less accurate than the direct method. c. The sequential method is also known as the step-up method. d. The sequential method requires that the same cost driver be...
Support department cost allocation-reciprocal services method Davis Snowflake & Co. produces Christmas stockings in its Cutting...
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: Maintenance Security Cutting Sewing Department Department Department Department Machine hours 800 2,000 6,800 11,200 Asset value $2,000...
Beta Corporation is planning operations for the coming year. Beta uses normal costing and applies overhead...
Beta Corporation is planning operations for the coming year. Beta uses normal costing and applies overhead on the basis of direct labor hours. The estimated overhead cost amounts to $10,000,000, estimated direct labor hours are 100,000, estimated direct labor cost amounts to $3,100,000, and estimated direct materials cost is $22,000,000. What is Beta's predetermined overhead rate? a $45 per direct labor hour b. $100 per direct labor hour C. $60 per direct labor hour d. $31 per direct labor hour...
(Appendix 4B) Sequential Method of Support Department Cost Allocation Stevenson Company is divided into two operating divisions: Battery and Small Motors. The company allocates power and general factory costs to each operating division using the sequential method. General Factory is allocated first in the sequential method for the company. Support department cost allocations using the sequential method are based on the following data: Support Departments Operating Divisions General Factory Small Motors Power Battery Overhead costs $430,000 $84,600 $160,000 2,000 $163,000...
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: Maintenance Security Cutting Sewing Department Department Department Department Machine hours 800 2,000 6,800 11,200 Asset value $2,000...
Beta Corporation is planning operations for the coming year. Beta uses normal costing and applies overhead on the basis of direct labor hours. The estimated overhead cost amounts to $10,000,000, estimated direct labor hours are 100,000, estimated direct labor cost amounts to $3,100,000, and estimated direct materials cost is $22,000,000. What is Beta's predetermined overhead rate? a $45 per direct labor hour b. $100 per direct labor hour C. $60 per direct labor hour d. $31 per direct labor hour...
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