Assume that a company has decided not to allocate any support department costs to producing departments. Describe the likely behavior of the managers of the producing departments. Would this be good or bad? Explain why allocation would correct this type of behavior.
Answer to relevant QuestionsIdentify some possible causal factors for the following support departments: a. Cafeteria b. Custodial services c. Laundry d. Receiving, shipping, and storage e. Maintenance f. Personnel g. Accounting Explain how overhead is assigned to production when a predetermined overhead rate is used. Wilson Company has a predetermined overhead rate of $5 per direct labor hour. The job-order cost sheet for Job 145 shows 500 direct labor hours costing $10,000 and materials requisitions totaling $7,500. Job 145 had 1,000 ...a. Hospital services b. Custom cabinet making c. Toy manufacturing d. Soft-drink bottling e. Airplane manufacturing (e.g., 767s) f. Personal computer assembly g. Furniture making (e.g., computer desks sold at discount ...Schulberg Company, a job-order costing firm, worked on three jobs in July. Data are as follows: Overhead is applied to jobs at the rate of $20 per machine hour. By July 31, Jobs 94 and 96 were completed. Jobs 90 and 94 were ...
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