Support-department cost allocation; direct and step-down methods. Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two sup- port departments-administrative services (AS) and information systems (IS)-and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Phoenix's cost records indicate the following: Home Insert Page Layout Formulas Data Review View в SUPPORT AS OPERATING IS GOVT CORP Total 3 Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS 5 (budgeted head count) Support work supplied by IS 6 (budgeted computer time) $600,000 $2,400,000 $8,756,000 $12,452,000 $24,208,000 25% 40% 35% 100% 10% 30% 60% 100%

Support-department cost allocation; direct and step-down methods. Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two sup- port departments-administrative services (AS) and information systems (IS)-and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Phoenix's cost records indicate the following: Home Insert Page Layout Formulas Data Review View в SUPPORT AS OPERATING IS GOVT CORP Total 3 Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS 5 (budgeted head count) Support work supplied by IS 6 (budgeted computer time) $600,000 $2,400,000 $8,756,000 $12,452,000 $24,208,000 25% 40% 35% 100% 10% 30% 60% 100%

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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Houstin Partners provides management consulting services to government and corporate clients. Houstin has two support departments-administrative services (AS) and information systems (IS)-and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Houstin's cost records indicate the following: E (Click the icon to view the cost records.) Read the requirements. ..... intermediary calculations and round your final answers balances.) Data table SUPPORT OPERATING AS IS GOVT CORP Total Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS (budgeted head count) Support work supplied by IS (budgeted computer time) $ 390,000 $ 2,100,000 $ 7,500,000 $ 12,420,000 $ 22,410,000 25% 45% 30% 100% 10% 36% 54% 100% Requirements Print Done 1. Allocate the two support departments' costs to the two operating departments using the following methods: а. Direct method b. Step-down method (Allocate AS…
Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two support departments administrative services (AS) and information systems (IS) and two operating departments-government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2020, Phoenix's cost records indicate the following: (Click the icon to view the cost records.) Read the requirements. Requirement 1c. Allocate the two support departments' costs to the two operating departments using the step-down method (Allocate IS first). (Do not round intermediary calculations and round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Enter a "0" for any zero balances.) Support Departments AS Operating Departments CORP Step-down Method IS GOVT Total Budgeted overhead costs 690,000 $2,100,000 $8,675,000 $12,490,000 $23,955,000 before interdepartment cost allocations Allocation of IS…
Atlanta Partners provides management consulting services to government and corporate clients. Atlanta has two support departments—administrative services (AS) and information systems (IS)—and two operating departments—government consulting (GOVT) and corporate consulting (CORP). For the first quarter of 2017, Atlanta's cost records indicate the following: Read the requirements2. Requirement 1a. Allocate the two support departments' costs to the two operating departments using the direct method. (Do not round intermediary calculations and round your final answers to the nearest whole dollar. Use parentheses or a minus sign when decreasing departments by allocating costs. Enter a "0" for any zero balances.) Support Departments Operating Departments Direct Method AS IS GOVT CORP Total Budgeted overhead costs before interdepartment cost allocations Allocation of AS costs…
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs Service department costs IT allocation HR allocation Total costs allocated IT $ IT 0 27 $ 151,000 0 $ HR Required: Use the direct method to allocate these service department costs to the operating departments. 1,400 0 Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. Round "Publishing" and "Binding" answers to 2 decimal places. HR $247,500 Publishing 1,400 35 $430,000 0 Publishing 0 $ Binding 4,200 51 $ 390,000 0.00 $ Binding 0.00
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: \table[[,IT,HR,Publishing,Binding],[,0,1,550,2,480,2,170],[IT tickets,16,0,24,40],[\table[[Employees],[Department direct costs]],$154,000,$248,400,$432,000,$395,000
Comprehensive support department allocations (Need answers for parts C, D, and E please. Thank you!) Management at C. Pier Press has decided to allocate costs of the paper’s two support departments (administration and human resources) to the two revenue-generating departments (advertising and circulation). Administration costs are to be allocated on the basis of dollars of assets employed; human resources costs are to be allocated on the basis of number of employees. The following costs and allocation bases are available: Department Direct Costs Number of Employees Assets Employed Administration $390,750 5 $193,550 Human resources 246,350 4 145,850 Advertising 478,900 6 381,200 Circulation 676,300 13 935,150 Totals $1,792,300 28 $1,655,750 a. Using the direct method, allocate the support department costs to the revenue-generating departments.Note: Round percentages in your calculation to the nearest whole percent (for example, round 34.5% to 35%).Note:…
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs Service department costs IT allocation HR allocation Total costs allocated IT IT 0 33 $ 157,000 HR HR 1,500 0 $ 247,500 Publishing 1,500 41 $ 430,000 Required: Use the direct method to allocate these service department costs to the operating departments. Note: Amounts to be deducted should be Indicated by a minus sign. Do not round Intermediate calculations. Round "Publishing" and "Binding" answers to 2 decimal places. Binding Publishing 4,500 57 $ 390,000 AL Binding
A company uses charging rates to allocate service department costs to the using departments. The accountant compiled the following information on one of the service departments: If Department K plans to use 1,350 hours of the service departments service in the coming year, how much of the service departments cost is allocated to Department K? a. 3,375 b. 27,300 c. 26,325 d. 23,950
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing.and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs From: Service department costs IT HR Total $ IT IT 0 20 $ 156,800 Required: Allocate the service department costs using the reciprocal method. (Matrix algebra is not required because there are only two service departments.) Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. 39,200 39,200 0x HR 1,585 0 $ 249,030 Answer is not complete. $ Cost Allocation To: HR Publishing 2,536 30 $ 433,400 0 0X 0 Publishing $ 0x 74,709 x 74,709 Binding 2,219 50 $ 398,500 $ Binding 0 x 124,515 124,515
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Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs. IT HR 0 16 1,525 0 Publishing 2,440 24 $ 152,000 $ 247,950 $ 431,000 Binding 2,135 40 $ 392,500 Woodstock Binding estimates that the variable costs in the IT Department total $112,500, and in the HR Department variable costs to $142,500. Avoidable fixed costs in the IT Department are $18,250. Required: If Woodstock Binding outsources the IT Department functions, what is the maximum it can pay an outside vendor without increasing total costs? Note: Do not round intermediate calculations. × Answer is complete but not entirely correct. Maximum…
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs a. The order of allocation starts with IT. b. The order of allocation starts with HR. IT Required A HR 1,200 0 0 16 $ 152,000 $ 249,600 Required: Use the step method to allocate the service costs, using the following: Required B Publishing 1,200 24 $430,000 Complete this question by entering your answers in the tabs below. X Answer is not complete. Use the step method to allocate the service costs, using the following: Binding Return to question 3,600 40 $ 390,000