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ok Exercise 11-15 (Algo) Service Department Charges [LO11-4] Korvanis Corporation operates a Medical Services Department for its employees. Charges to the company's operating departments for the variable costs of the Medical Services Department are based on the actual number of employees in each department. Charges for the fixed costs of the Medical Services Department are based on the long-run average number of employees in each operating department. Variable Medical Services Department costs are budgeted at $59 per employee. Fixed Medical Services Department costs are budgeted at $662,100 per year. Actual Medical Services Department costs for the most recent year were $106,200 for variable costs and $668,000 for fixed costs. Data concerning employees in the three operating departments follow: Budgeted number of employees Cutting 606 Milling 287 Assembly 916 Actual number of employees for the most recent year 506 387 816 Long-run average number of employees 960 640 1,600 Required: ces 1. Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. 2. How much, if any, of the actual Medical Services Department costs for the year should be treated as a spending variance and not charged to the operating departments? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. Cutting Milling Assembly Medical services department charges

ok Exercise 11-15 (Algo) Service Department Charges [LO11-4] Korvanis Corporation operates a Medical Services Department for its employees. Charges to the company's operating departments for the variable costs of the Medical Services Department are based on the actual number of employees in each department. Charges for the fixed costs of the Medical Services Department are based on the long-run average number of employees in each operating department. Variable Medical Services Department costs are budgeted at $59 per employee. Fixed Medical Services Department costs are budgeted at $662,100 per year. Actual Medical Services Department costs for the most recent year were $106,200 for variable costs and $668,000 for fixed costs. Data concerning employees in the three operating departments follow: Budgeted number of employees Cutting 606 Milling 287 Assembly 916 Actual number of employees for the most recent year 506 387 816 Long-run average number of employees 960 640 1,600 Required: ces 1. Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. 2. How much, if any, of the actual Medical Services Department costs for the year should be treated as a spending variance and not charged to the operating departments? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. Cutting Milling Assembly Medical services department charges

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 30E: A company uses charging rates to allocate service department costs to the using departments. The...
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ok Exercise 11-15 (Algo) Service Department Charges [LO11-4] Korvanis Corporation operates a Medical Services Department for its employees. Charges to the company's operating departments for the variable costs of the Medical Services Department are based on the actual number of employees in each department. Charges for the fixed costs of the Medical Services Department are based on the long-run average number of employees in each operating department. Variable Medical Services Department costs are budgeted at $59 per employee. Fixed Medical Services Department costs are budgeted at $662,100 per year. Actual Medical Services Department costs for the most recent year were $106,200 for variable costs and $668,000 for fixed costs. Data concerning employees in the three operating departments follow: Budgeted number of employees Cutting 606 Milling 287 Assembly 916 Actual number of employees for the most recent year 506 387 816 Long-run average number of employees 960 640 1,600 Required: ces 1. Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. 2. How much, if any, of the actual Medical Services Department costs for the year should be treated as a spending variance and not charged to the operating departments? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. Cutting Milling Assembly Medical services department charges
Transcribed Image Text:ok Exercise 11-15 (Algo) Service Department Charges [LO11-4] Korvanis Corporation operates a Medical Services Department for its employees. Charges to the company's operating departments for the variable costs of the Medical Services Department are based on the actual number of employees in each department. Charges for the fixed costs of the Medical Services Department are based on the long-run average number of employees in each operating department. Variable Medical Services Department costs are budgeted at $59 per employee. Fixed Medical Services Department costs are budgeted at $662,100 per year. Actual Medical Services Department costs for the most recent year were $106,200 for variable costs and $668,000 for fixed costs. Data concerning employees in the three operating departments follow: Budgeted number of employees Cutting 606 Milling 287 Assembly 916 Actual number of employees for the most recent year 506 387 816 Long-run average number of employees 960 640 1,600 Required: ces 1. Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. 2. How much, if any, of the actual Medical Services Department costs for the year should be treated as a spending variance and not charged to the operating departments? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the Medical Services Department charges for the year to each of the operating departments-Cutting, Milling, and Assembly. Cutting Milling Assembly Medical services department charges
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