Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly Department & Packaging Department.) Frederick uses a step allocation method where Cafeteria Services is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Cafeteria Services has costs of $275,000 and Maintenance has costs of $280,000 before any allocations. What amount of Maintenance total cost is allocated to the Packaging Department? (round to closest whole dollar) Employees are:
Cafeteria Services 3
Maintenance 3
Assembly Department 8
Packaging Department 8
Bowie Sporting Goods manufactures sleeping bags. The manufacturing standards per sleeping bag, based on 5,000 sleeping bags per month, are as follows:
Direct material of 4.00 yards at $5.00 per yard
Direct labor of 2.00 hours at $16.00 per hour
Overhead applied per sleeping bag at $18.00
In the month of April, the company actually produced 4,900 sleeping bags using 25,100 yards of material at a cost of $5.90 per yard. The labor used was 11,500 hours at an average rate of $20.50 per hour. The actual overhead spending was $96,200.
Determine the materials price variance and round to the nearest whole dollar. Enter a favorable variance as a negative number. Enter an unfavorable variance as a positive number.
1) Calculation of Cost Allocated to Production Department (Amounts in $)
| Cafeteria Services | Maintenance | Assembly Department | Packaging | |
| Costs | 275,000 | 280,000 | 0 | 0 |
| Allocation of Cafeteria services (in ratio of 3:8:8) | (275,000) | 43,421 | 115,789 | 115,790 |
| Allocation of Maintenance Dept (in the ratio of 8:8) | 0 | (323,421) | 161,711 | 161,710 |
| Total Allocated Cost | 0 | 0 | 277,500 | 277,500 |
Therefore amount of Maintenance total cost allocated to the Packaging Department is $161,710.
2) Materials Price Variance = (Std price - Actual price)*Actual quantity of material
= ($5 per yard - $5.90 per yard)*25,100 yards
= $22,590 Unfavorable
Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly...
Question 22 (3.5 points) Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly Department & Packaging Department.) Frederick uses a step allocation method where Cafeteria Services is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Cafeteria Services has costs of $235,000 and Maintenance has costs of $250,000 before any allocations. What amount of Maintenance total cost is allocated to the Packaging...
Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly Department & Packaging Department.) Frederick uses a step allocation method where Cafeteria Services is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Cafeteria Services has costs of $295,000 and Maintenance has costs of $175,000 before any allocations. What amount of Maintenance total cost is allocated to the Packaging Department? (round to closest...
Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly Department & Packaging Department.) Frederick uses a step allocation method where Cafeteria Services is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Cafeteria Services has costs of $205,000 and Maintenance has costs of $195,000 before any allocations. What amount of Maintenance total cost is allocated to the Packaging Department? (round to closest...
Bowie Sporting Goods manufactures sleeping bags. The manufacturing standards per sleeping bag, based on 5,000 sleeping bags per month, are as follows: Direct material of 4.00 yards at $5.50 per yard Direct labor of 3.00 hours at $18.00 per hour Overhead applied per sleeping bag at $18.00 In the month of April, the company actually produced 4,900 sleeping bags using 25,000 yards of material at a cost of $5.30 per yard. The labor used was 11,500 hours at an average...
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