Question

The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include:
Fixed costs (salaries, tools): .... $64,900 per year
Variable costs (supplies): ..... $1.35 per maintenance hour
Estimated usage by:
Assembly Department ....... 4,500
Fabricating Department ....... 6,700
Packaging Department ....... 10,800
Total maintenance hours....... 22,000
Actual usage by:
Assembly Department ....... 3,960
Fabricating Department....... 6,800
Packaging Department....... 10,000
Total maintenance hours....... 20,760
Required:
1. Calculate a single charging rate for the Maintenance Department.
2. Use this rate to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year.
3. What if the Assembly Department used 4,000 maintenance hours in the year? How much would have been charged out to the three departments?


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  • CreatedSeptember 01, 2015
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