Question

Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General F
Required: 1. Calculate the allocation ratios for the four departments using the direct method. If an amount is zero, enter 0
0 0
Add a comment Improve this question Transcribed image text
Answer #1

Requirement 1:

Proportion of driver used by
Human resources General factory Fabricating Assembly
Human resources 0% 0% 32.00% 30.00%
General factory 0% 0% 68.00% 70.00%

Calculations:

1 Human resources Fabricating Assembly Total
No. of employees 80 170 250
Proportion 32.00% 68.00% 100%
[80/250] x 100 [170/250] x 100
2 General factory Fabricating Assembly Total
Square footage 5,700 13,300 19,000
Proportion 30.00% 70.00% 100%
[5,700/19,000] x 100 [13,300/19000] x 100

Requirement 2:

Support Departments Production Departments
Human resources General factory Fabricating Assembly
Direct costs $160,000 $340,000 $114,600 $93,000
Allocate:
Human Resources (32:68) ($160,000) $51,200 $108,800
General Factory (30:70) ($340,000) $102,000 $238,000
Total after allocation $0 $0 $267,800 $439,800
Add a comment
Know the answer?
Add Answer to:
Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources an...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and...

    Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $160,000 $340,000 $114,600 $93,000 Normal activity: Number of employees — 60 80 170 Square footage 1,000 — 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated...

  • Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and...

    Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $160,000 $340,000 $114,600 $93,000 Normal activity: Number of employees — 60 80 170 Square footage 1,000 — 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated...

  • Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and...

    Direct Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $150,000 $330,000 $114,200 $94,000 Normal activity: Number of employees — 60 80 170 Square footage 1,000 — 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated...

  • Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources...

    Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $160,000 $340,000 $114,600 $93,000 Normal activity: Number of employees — 60 80 170 Square footage 1,000 — 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are...

  • Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources...

    Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $170,000    $330,000    $114,600    $91,000    Normal activity:    Number of employees —    50    70    160       Square footage 1,100    —    5,900    13,000    Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of...

  • Reciprocal Method of Support Department Cost AllocationValron Company has two support departments, Human Resources and...

    Reciprocal Method of Support Department Cost AllocationValron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly.Support DepartmentsProducing DepartmentsHumanResourcesGeneralFactoryFabricatingAssemblyDirect costs$170,000$330,000$114,200$95,000Normal activity:Number of employees—6080170Square footage1,000—5,70013,300The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage.Now assume that Valron Company uses the reciprocal method to allocate support department costs.Required:1. Calculate the allocation ratios (rounded to four...

  • Calculating Departmental Overhead Rates Using Post-Allocation Costs Valron Company has two support departments, Human Resources and...

    Calculating Departmental Overhead Rates Using Post-Allocation Costs Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct costs $160,000 $340,000 $114,600 $93,000 Normal activity: Number of employees — 60 80 170 Square footage 1,000 — 5,700 13,300 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated...

  • Calculating Departmental Overhead Rates Using Post-Allocation Costs Valron Company has two support departments, Human Resources and...

    Calculating Departmental Overhead Rates Using Post-Allocation Costs Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly Support Departments Producing Departments Human Resources General Factory Fabricating Assembly Direct easts $160,000 $340,000 $114,600 593,000 Normal activity: Number of employees 60 30 170 13,300 Square footage 1,000 5,700 The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the...

  • Sequential Method Eilers Company has two producing departments and two support departments. The following budgeted...

    Sequential Method Eilers Company has two producing departments and two support departments. The following budgeted data pertain to these four departments: Support Departments Producing Departments General Factory Receiving Assembly Finishing Direct overhead $400,000 $160,000 $43,000 $74,000 Square footage 2,700 5,400 5,400 Number of receiving orders 300 1,680 1,020 Direct labor hours 25,000 40,000 The support departments are ranked in order of highest cost to lowest cost. Required: 1. Allocate the costs of the support departments using the sequential method. (Use...

  • Sequential Method Eilers Company has two producing departments and two support departments. The following budgeted data...

    Sequential Method Eilers Company has two producing departments and two support departments. The following budgeted data pertain to these four departments: Support Departments Producing Departments General Factory Receiving Assembly Finishing Direct overhead $400,000 $160,000 $43,000 $74,000 Square footage — 2,700 5,400 5,400 Number of receiving orders 300 — 1,680 1,020 Direct labor hours — — 25,000 40,000 The support departments are ranked in order of highest cost to lowest cost. Required: 1. Allocate the costs of the support departments using...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT