Question

Garden Enclosures, Inc., makes metal gates. The company has three product lines—standard, deluxe, and custom gates. Garden Enclosures integrates its service department allocation system with its ABC system. There are two service departments—power and facilities management. Garden Enclosures allocates its two service department costs to the processing department using the direct method based on megawatt hours and machine hours consumed. There are two activity centers in the processing department—setup/maintenance and assembly. Parts and assembly labor are traced directly to each product. Setup/maintenance costs are allocated based on number of setups, and assembly costs are allocated based on machine hours.
Data for a recent reporting period follow:


Prepare a schedule that calculates the gross profit available to cover other value-chain costs for each product and Garden Enclosures as a whole company.


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  • CreatedNovember 19, 2014
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