1. Support department cost allocationsequential method

Becker Tabletops has two support departments (Janitorial and Cafeteria) and two production departments (Cutting and Assembly). Relevant details for these departments are as follows:

Support Department		Cost Driver
Janitorial Department		Square footage to be serviced
Cafeteria Department		Number of employees

	Janitorial Department	Cafeteria Department	Cutting Department	Assembly Department
Department costs	$310,000	$169,000	$1,504,000	$680,000
Square feet	50	5,000	1,000	4,000
Number of employees	10	3	30	10

Allocate the support department costs to the production departments using the sequential method.

Allocate the support department with the highest department cost first.

	Cutting Department		Assembly Department
Janitorial Department	$		$
Cafeteria Department	$		$

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2.

Joint Cost AllocationNet Realizable Value Method

Lilys Lemonade Stand makes three types of lemonade: pure, raspberry, and strawberry. The lemonade is produced through a joint mixing process that costs a total of $30 per batch. One batch produces 32 cups of pure lemonade, 21 cups of strawberry lemonade, and 21 cups of raspberry lemonade. After the split-off point, all three lemonades can be sold for $0.80 per cup, but strawberry and raspberry lemonade can be processed further by adding artificial coloring and flavoring and sold for $0.95 and $1.00 per cup, respectively. It is estimated that these additional processing costs are $0.75 and $1.80 per batch for strawberry and raspberry lemonade, respectively.

Allocate the joint costs of production to each product using the net realizable value method.

Joint Product	Allocation
Pure lemonade	$
Strawberry lemonade
Raspberry lemonade
Totals	$

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3.

Support department cost allocationreciprocal services method

Becker Tabletops has two support departments ( Janitorial and Cafeteria) and two production departments (Cutting and Assembly). Relevant details for these departments are as follows:

Support Department		Cost Driver
Janitorial Department		Square footage to be serviced
Cafeteria Department		Number of employees

	Janitorial Department	Cafeteria Department	Cutting Department	Assembly Department
Department costs	$310,000	$169,000	$1,504,000	$680,000
Square feet	50	5,000	1,000	4,000
Number of employees	10	3	30	10

Allocate the support department costs to the production departments using the reciprocal services method.

		Cutting Department		Assembly Department
Janitorial Department cost allocation		$		$
Cafeteria Department cost allocation		$		$