Interdepartment Services: Direct MethodWilhelm Manufacturing Company has five operating departments, two of which are producing departments (P1 and P2) and three of which are service departments (S1, S2, and S3). All costs of the service departments are allocated to the producing departments. The following table shows the distribution of services from the service departments.Services provided Services Provided tofromS1 S2 S3 P1 P2-- 5% 25% 50% 20%5 45 4020 60S1S2S3The direct operating costs of the service departments are as follows:S1 $ 98,000S2 187,000S3 36,000Total costs10%Using the step method, prepare a schedule for Wilhelm Manufacturing Company allocating the service department costs to the producing departments. (Round calculations to the nearest dollar. Do not round until your final answers.)Service DepartmentsProducing DepartmentsP1S20 $P2158,260 x162,740 x $Check15 5S1S30

Under the step method for overhead cost allocation the costs from one service department are…

Interdepartment Services: Direct Method Wilhelm Manufacturing Company has five operating departments, two of which are producing departments (P1 and P2) and three of which are service departments (51, 52, and 53). All costs of the service departments are allocated to the producing departments. The following table shows the distribution of services from the service departments. Services provided Services Provided to from 51 52 53 P1 P2 |SW|25% 50% 20% 10% 5 45 40 15 5 20 60 The direct operating costs of the service departments are as follows: $1$ 98,000 $2 187,000 53 36,000 Using the step method, prepare a schedule for Wilhelm Manufacturing Company allocating the service department costs to the producing departments (Round calculations to the nearest dollar. Do not round until your final answers) Service Departments 52 51 Total costs $ Check 53 ous OUS 0 Producing Departments P1 P2 162,740 x 158,260 $

Interdepartment Services: Direct Method Wilhelm Manufacturing Company has five operating departments, two of which are producing departments (P1 and P2) and three of which are service departments (51, 52, and 53). All costs of the service departments are allocated to the producing departments. The following table shows the distribution of services from the service departments. Services provided Services Provided to from 51 52 53 P1 P2 |SW|25% 50% 20% 10% 5 45 40 15 5 20 60 The direct operating costs of the service departments are as follows: $1$ 98,000 $2 187,000 53 36,000 Using the step method, prepare a schedule for Wilhelm Manufacturing Company allocating the service department costs to the producing departments (Round calculations to the nearest dollar. Do not round until your final answers) Service Departments 52 51 Total costs $ Check 53 ous OUS 0 Producing Departments P1 P2 162,740 x 158,260 $

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter5: Support Department And Joint Cost Allocation

Section: Chapter Questions

Problem 1CMA

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Yekka Corporation has two producing department and two service departments labeled P1, P2, S1 and S2, respectively. Direct costs for each department and the proportion of services costs used by various departments are as follows: Cost Center Direct Costs Proportion of services used by: S1 S2 P1 P2 P1 90,000 P2 60,000 S1 20,000 - .80 .1 .1 S2 32,000 .20 - .50 .30 In calculating predetermined overhead rates, machine hours are used as the base in P1 and direct labor hours as the base in P2. P1 P2 Machine hours 50,000 40,000 Direct labor hours 40,000 20,000 Requirements: Allocate the service department costs to operating departments and compute the factory…
II. AJA Company has two service departments (A and B) and two producing departments (X and Y). Data provided are as follows: Service Departments Operating Departments Y A В Direct Costs P150 P300 P5,000 P6,000 Services performed by Dept. A Services performed by Dept. B 40% 40% 20% 20% 70% 10% 1) If the company is using the direct method to allocate service department costs, the service department cost allocated to Department Y is: 2) Using the information in number 1, what is the total cost for Department X? 3) If the company is using the step-down to allocate service department costs and Department A costs are allocated first, the service department cost allocated to Department Y is? 4) Using the information in number 3, the total cost for Department X is? 5) If the reciprocal method is used, the service department cos allocated to department Y is?
II. AJA Company has two service departments (A and B) and two producing departments (X and Y). Data provided are as follows: Service Departments B P300 Operating Departments A Y Direct Costs P150 P5,000 P6,000 Services performed by Dept. A Services performed by Dept. B 40% 40% 20% 20% 70% 10% 1) If the company is using the direct method to allocate service department costs, the service department cost allocated to Department Y is: 2) Using the information in number 1, what is the total cost for Department X? 3) If the company is using the step-down to allocate service department costs and Department A costs are allocated first, the service department cost allocated to Department Y is? 4) Using the information in number 3, the total cost for Department X is? 5) If the reciprocal method is used, the service department cos allocated to department Y is?
Dolphin Company has two service departments, S1 and S2 and three production departments, P1, P2 and P3. The following data relate to Dolphin Company's allocation of service department costs: Number of Employees S1 S2 IP1 P2 P3 O $13,333 The allocation of costs from S2 to S1 would be: O $4,800 Cost O $0 80,000 40,000 100,000 800,000 1,200,000 O $10,000 S1 allocates its costs on the basis of number of employees. S2 allocates its costs on the basis of kilowatt hours. The order of allocation for Dolphin Company is S1 first and S2 second. Dolphin Company uses the direct method to allocate its service department costs. Problem 3-4 2 3 3 6 6 Kilowatt Hours 600 400 500 1,000 2,500
Reciprocal Method of Support Department Cost Allocation Chekov Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Direct costs Normal activity: Number of employees Square footage Support Departments Human Resources $150,000 Human Resources 1,500 General Factory Human Resources General Factory $330,000 0 60 ✓ Producing Departments 14,000 ) 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 basis of square footage. Now assume that Chekov Company uses the reciprocal method to allocate support department costs. Fabricating Assembly $114,800 $95,000 Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the reciprocal method. If an amount is zero, enter "0". Use the rounded values for subsequent calculations. Proportion of Driver Used by General Factory 45 X…
· Deavayded departments (S1 and S2) and two producing departments (P1 and P2). Department data for April were as follows: Company has two service si P27,000 S2 Overhead costs P18,000 Services provided to: si -0- 20% S2 10% -0- 50% 40% P1 30% P2 50% What is the total allocated service department cost to P2 if the company uses the reciprocal method of allocating its service department costs? P19,800 P21,949 P22,500 P23,051
Direct Method of Support Department Cost Allocation Chekov Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. Direct costs Normal activity: Number of employees Square footage Support Departments Producing Departments Human Resources $160,000 General Factory $360,000 Fabricating Assembly $114,200 $95,000 60 45 80 1,500 6,000 14,000 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 basis of square footage. Chekov Company uses the direct method of support department cost allocation. Required: 1. Calculate the allocation ratios for the four departments using the direct method. If an amount is zero, enter "0". Round your answer to the nearest cent. Proportion of Driver Used by Human Resources Human Resources General Factory General Factory Fabricating Assembly 2. Using the direct method, allocate the costs of the…
The estimated departmental manufacturing for producing departmenta A and Band the estimated costs of service departments C, D, and E (befor any service department allocations) are: Producing Department Service Department P120,000 180,000 P40,000 B D 40,000 E 20,000 The interdependence of the departments is as follows: Services Provided by Department D E Producing A Producing B Service C Service D Service E 30% 40% 50% 40 30 20 20 30 Marketing General office 20 10 100% 100% 100% Compute the final amount of estimated overhead of Service E after reciprocal transfer costs have been calculated algebraically. After computing the total factory overhead of each producing department and what amount of Department E cost is assigned to Marketing Department?
Snowflake Company has two service departments (S1 and S2) and two producing departments (P1 and P2). Department S1 costs are allocated on the basis of number of employees, and Department S2 costs are allocated on the basis of space occupied expressed in square feet. Data on direct department costs, number of employees, and space occupied are as follows: Direct dept. costs Number of employees Space occupied P1 P2 0 S1 S2 P1 $15,000 $22,000 $55,000 0 10 2,000 If Snowflake uses the direct method, what is the ratio representing the portion of Department S2 allocated to P2? 25 5 1,000 3,000 P2 $60,000 30 7,000
Support Department Cost Allocation—Direct Method Yo-Down Inc. produces yogurt. Information related to the company’s yogurt production follows: Production Department 1 ProductionDepartment 2 ProductionDepartment 3 Support Department 1 cost driver 4,000 800 3,200 Support Department 1’s costs total $130,000. Using the direct method of support department cost allocation, determine the costs from Support Department 1 that should be allocated to each production department. Production Department 1 ProductionDepartment 2 ProductionDepartment 3 Support Department 1 cost allocation $ $ $
Goodfriend Corp. provides the following information: Service Service Dept. Z Dept. X $1,000 $600 Costs to be allocated Proportions of service provided by Dept. X Proportions of service provided by Dept. Z Compute the cost allocations To S: S .10 .20 Production Dept. S .20 .45 Production Dept. T to Dept. S and Dept. T under the reciprocal method: To T: S .60 .45
Support Department Cost Allocation—Direct Method Yo-Down Inc. produces yogurt. Information related to the company’s yogurt production follows: ProductionDepartment 1 ProductionDepartment 2 ProductionDepartment 3 Support Department 1 cost driver 6,000 1,500 2,500 Support Department 1’s costs total $130,000. Using the direct method of support department cost allocation, determine the costs from Support Department 1 that should be allocated to each production department. ProductionDepartment 1 ProductionDepartment 2 ProductionDepartment 3 Support Department 1 cost allocation $fill in the blank 1 $fill in the blank 2 $fill in the blank 3