Shaping department overheads = $60,000
Total machine hours = 10,000
Overhead rate for Shaping department = Shaping department overheads/ Total machine hours
= 60,000/10,000
= $6 per machine hour
Machine hours used on Job 599 = 3,000
Overhead assigned to Job 599 = Machine hours used on Job 599 x Overhead rate for Shaping department
= 3,000 x 6
= $18,000
Correct option is A.
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27. The overhead costs shown are overhead costs prior to allocation. The service department costs are...
1. Support Department Cost Allocation—Direct Method Christmas Timber, Inc., produces Christmas trees. The trees are produced through a cutting and pruning process. Machine maintenance and janitorial labors are performed throughout the production process by nonproduction employees. Maintenance and janitorial costs are allocated based on machine hours used and the number of trees in each department, respectively. The company estimates that the cutting and pruning areas typically have about 24 and 56 trees, respectively, in them at 1 time. The company...
Service Department Cost Allocation Presented below are certain operating data for the four depart- ments of Tally Manufacturing Company. Service Production 1 2 1 2 $60,000 $72,000 Total manufacturing overhead costs either identifiable with or allocated to each department .... Square feet of factory floor space. Number of factory workers ... Planned direct labor hours for the year $90,000 40,000 50 20,000 $98,000 80,000 10 30,000 Allocate, to the two production departments, the costs of service departments 1 and 2,...
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...
1. 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 Department Security Department Cutting Department Sewing Department Machine hours 800 2,000 6,400 11,600...
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...
Support Department Cost Allocation—Direct Method Charlie’s Wood Works produces wood products (e.g., cabinets, tables, picture frames, and so on). Production departments include Cutting and Assembly. The Janitorial and Security departments support the Cutting and Assembly departments. The Assembly Department spans about 46,400 square feet and holds assets valued at about $60,000. The Cutting Department spans about 33,600 square feet and holds assets valued at about $140,000. Charlie’s Wood Works allocates support department costs using the direct method. If costs from...
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 Se p artme production of the toys. Costs from the Janitorial Department are allocated based on square feet. Costs from the Security Department are located based on Relevant department information is provided in the following table: Janitorial Security Molding Assembly Department Department Department Department Square feet 640 700 700 5,600 Asset value $360 $380...
(Appendix 4B) Support Department Cost Allocation:
Comparison of Methods of Allocation
Objective 6Bender Automotive
Works Inc. manufactures a variety of front-end assemblies for
automobiles. A front-end assembly is the unified front of an
automobile that includes the headlamps, fender, and surrounding
metal/plastic. Bender has two producing departments: Drilling and
Assembly. Usually, the front-end assemblies are ordered in batches
of 100.
Two support departments provide support for Bender's producing
departments: Maintenance and Power. Budgeted data for the coming
quarter follow. The...
Support Department Cost Allocation-Direct Method Christmas Timber, Inc., produces Christmas trees. The trees are produced through a cutting and pruning process. Machine maintenance and janitorial labors are performed throughout the production process by nonproduction employees. Maintenance and janitorial costs are allocated based on machine hours used and the number of trees in each department, respectively. The company estimates that the cutting and pruning areas typically have about 9 and 81 trees, respectively, in them at 1 time. The company also...
The managers of Yoyodyne Propulsion Systems are discussing ways to allocate the cost of support departments such as Quality concor and Maintenance to the Machining and Assembly production departments. To aid them in this discussion, the controller has provided the following information: Quality Control Maintenance Machining Assembly Total $350,000 $200,000 $400,000 $300,000 $1,250,000 50,000 50,000 25,000 25,000 Budgeted overhead costs before allocation Budgeted Machine-hours Budgeted Direct manufacturing labor- hours Budgeted units of service: - Quality Control - Maintenance 7,000 21,000...