Anchor Company manufactures a variety of tool boxes. They have two operating divisions - Corporate Sales...
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Anchor Company manufactures a variety of tool boxes. They have two operating divisions - Corporate Sales and Consumer Sales - and two support divisions -Admin and IT. Each operating division operates independently. Anchor uses the number of employees to allocate Admin costs and computer processing time to allocate IT costs. The following data are available for the month: SUPPORT DEPT OPERATING DEPT Corp Sales Cons. Sales Admin IT Budgeted Costs $200,000 $350,000 $1,500,000 $950,000 # of Employees 25 85 60 Budget IT support minutes 500 -> 3,600 2,900 REQUIRED: Using the reciprocal method, allocate the support department costs. (8 Marks) Anchor Company manufactures a variety of tool boxes. They have two operating divisions - Corporate Sales and Consumer Sales - and two support divisions -Admin and IT. Each operating division operates independently. Anchor uses the number of employees to allocate Admin costs and computer processing time to allocate IT costs. The following data are available for the month: SUPPORT DEPT OPERATING DEPT Corp Sales Cons. Sales Admin IT Budgeted Costs $200,000 $350,000 $1,500,000 $950,000 # of Employees 25 85 60 Budget IT support minutes 500 -> 3,600 2,900 REQUIRED: Using the reciprocal method, allocate the support department costs. (8 Marks)
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