Swift Company has a Maintenance Department which provides service to line departments A and B. The...
Swift Company has a Maintenance Department which provides
service to line departments A and B. The cost driver in the
Maintenance Department is machine hours worked by the line
departments. The Maintenance Department planned variable cost of
$8,000 for June. Actual variable cost for the month totaled
$15,000. Budget and actual machine hours in the operating
departments for the month are shown below. How much variable
maintenance cost should be charged to Dept. A for performance
evaluation (end of period)?
Dept. A Dept. B
Budget machine hours 22,000 18,000
Actual machine hours 30,000 20,000
Homework Answers
Total budgeted machine hours= 22000+18000= 40000 hours
Planned variable cost per machine hour= Total variable cost/Total budgeted machine hours
= $8000/40000= 0.20 per machine hour
Actual machine hours of Department A= 30000 hours
Variable maintenance cost charged to Department A= Actual machine hours of Department A*Planned variable cost per machine hour
= 30000*0.20= $6000
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Swift Company has a Maintenance Department which provides
service to line departments A and B. The...
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Assembly Department. The cost of this servicing is charged to the
operating departments on the basis of machine-hours. Cost and other
data relating to the Maintenance Department and to the other two
departments for the most recent year are presented below.
Data for the Maintenance Department follow:
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Tasman Products, Ltd., of Australia has a Maintenance Department that services the equipment in the company's Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine-hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below. Data for the Maintenance Department follow: Variable costs for lubricants Fixed costs for salaries and other Budget $ 294,000* $210,000...
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that services the equipment in the company’s Forming Department and
Assembly Department. The cost of this servicing is charged to the
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data relating to the Maintenance Department and to the other two
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Data for the Maintenance Department follow:
1. How much Maintenance Department cost should be charged to the
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