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Answer the following questions using the information below:
Company "ABC" has two service departments, Maintenance and Personnel.
Maintenance Department costs of $400,000 are allocated based on budgeted maintenance-hours.
Personnel Department costs of $100,000 are allocated based on the number of employees.
The costs of operating departments A and B are $160,000 and $240,000, respectively.
Data on budgeted maintenance-hours and number of employees are as follows:
| Support Departments | Production Departments | |
| Maintenance | Personnel | A | B |
| Budgeted costs | $400,000 | $100,000 | $160,000 | $240,000 |
| Budgeted maintenance-hours | NA | 1,000 | 600 | 400 |
| Number of employees | 40 | NA | 160 | 480 |
| | | | | |
Using the direct method, what amount of Maintenance Department and Personal Department costs will be allocated to Department A and B?
| A. | $240,000 and $160,000 $25,000 and $75,000 |
| B. | $180,000 and $120,000 $25,000 and $75,000 |
| C. | None of them |
| D. | $96,000 and $64,000 $20,000 and $50,000 |
Answer the following questions using the information below:
Company "ABC" has two service departments, Maintenance and Personnel.
Maintenance Department costs of $400,000 are allocated based on budgeted maintenance-hours.
Personnel Department costs of $100,000 are allocated based on the number of employees.
The costs of operating departments A and B are $160,000 and $240,000, respectively.
Data on budgeted maintenance-hours and number of employees are as follows:
| Support Departments | Production Departments | |
| Maintenance | Personnel | A | B |
| Budgeted costs | $400,000 | $100,000 | $160,000 | $240,000 |
| Budgeted maintenance-hours | NA | 1,000 | 600 | 400 |
| Number of employees | 40 | NA | 160 | 480 |
| | | | | |
Using the step-down method, what amount of Maintenance Department cost will be allocated to Personnel Department, Departments A and Department B?
| A. | $160,000; $100,000; and $96,000 |
| B. | $160,000; $250,000; and $64,000 |
| C. | $200,000; 120,000; and 80,000 |
| D. | $150,000; $90,000; and $60,000 |
Answer the following questions using the information below:
Company "ABC" has two service departments, Maintenance and Personnel.
Maintenance Department costs of $400,000 are allocated based on budgeted maintenance-hours.
Personnel Department costs of $100,000 are allocated based on the number of employees.
The costs of operating departments A and B are $160,000 and $240,000, respectively.
Data on budgeted maintenance-hours and number of employees are as follows:
| Support Departments | Production Departments | |
| Maintenance | Personnel | A | B |
| Budgeted costs | $400,000 | $100,000 | $160,000 | $240,000 |
| Budgeted maintenance-hours | NA | 1,000 | 600 | 400 |
| Number of employees | 40 | NA | 160 | 480 |
| | | | | |
Using the step-down method, what amount of Personal Department cost will be allocated to Departments A and Department B?
| A. | $62,500 and $187,500 |
| B. | None of them |
| C. | $75,00 and $225,000 |
| D. | $160,000 and $96,000 |
1) Company "Y" has two service departments DA and DB, and two production departments, P1 and P2.
| Services provided to: |
| Departments Costs | DA $92,000 | DB $60,000 | P1 | P2 |
| | 15% | | |
| 20% | | | |
Required:
Set up algebraic equations in linear form for each department to express reciprocal relationship
Department A (DA) and Department B (DB)
| A. | DA = $92,000 + 0,2 DB and DB = $60,000 + 0,15 DA |
| B. | DA = $92,000 + 0,05 DB and DB = $60,000 + 0,05 DA |
| C. | DA = $92,000 + 0,15 DB and DB = $60,000 + 0,2 DA |
) Company "Y" has two service departments, DA and DB, and two production departments, P1 and P2.
| Services provided to: |
| Departments Costs | DA $92,000 | DB $60,000 | P1 | P2 |
| | 15% | | |
| 20% | | | |
Required:
Solve the set of linear equation to obtain complete reciprocated costs of support department DA
| A. | DA = $113,402 |
| B. | DA = $104,216 |
| C. | DA = $105,154 |
| D. | None of them |
1) Company "Y" has two service departments, DA and DB, and two production departments, P1 and P2.
| Services provided to: |
| Departments Costs | DA $92,000 | DB $60,000 | P1 | P2 |
| | 15% | | |
| 20% | | | |
Required:
Solve the set of linear equation to obtain complete reciprocated costs of support department DB
| A. | DB = $67,010 |
| B. | DB = $76,082 |
| C. | None of them |
| D. | DB= $75,773 |
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