i want to ask this question please... From the informations available above, how
ID: 341752 • Letter: I
Question
i want to ask this question please... From the informations available above, how to do number 4 ?
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Used By Supplied By Buildings & Grounds Building&Grounds;Computer ServicesSigns Mailers 0.60 0.30 0.20 0.55 1 0.20 Computer Services The actual results for the time period were as follows: Supplied By Buildings & Grounds 0.15 Used By Building & Grounds Computer Services Signs 0.60 0.35 0.30 0.40 0.10 Computer Services 0.25 Actual cost data for each department are: Buildings & Grounds Computer Services Fixed S 50,000 $100,000 Variable $90,000 $21,000 3. Total fixed costs allocated from Buildings & Grounds to the Signs Department, using the preferred d. $25,000 4. Total variable costs allocated from Computer Services to Mailers Department, using the preferred d. $25,235. allocation basis, by the direct allocation method are $37,500 b. $33,333. c. $30,000. allocation basis, by the step-down allocation method (begin with Building & Grounds) are a. $8,400. b. $12,000. c. $16,000. 5. The equation to determine the total variable costs of Computer Services using the preferred allocation basis, for the reciprocal allocation method is a. CS = $21,000 + 0.25 B&G.; b. CS $21,000 +0.20 B&G.; c·,CS = $21 ,000 + 0.1 5 B&G.; CS = $21 ,000 + 0.1 0 B&G.;Explanation / Answer
4)
Answer
d) $ 25235
Explanation
Using Preferred allocation basis step Down method ( Begin with building and ground)
Total Variable cost allocatable from computer services = Direct Cost + Allocation from building and ground to computer sevices
Total Variable cost allocatable from computer services = 21000 + 90000*0.20/(0.20+0.60+0.20)
Total Variable cost allocatable from computer services = 39000
Total Variable cost allocated from computer services to mailer department = Total Variable cost allocatable from computer services *proportion
Total Variable cost allocated from computer services to mailer department = 39000*0.55/(0.55+0.30)
Total Variable cost allocated from computer services to mailer department = 25235
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