Question: Direct and step methods Salado Inc. provides cleaning services through its Residential and Commercial divisions. Support services of the company are provided by Personnel and
Direct and step methods Salado Inc. provides cleaning services through its Residential and Commercial divisions. Support services of the company are provided by Personnel and Administration areas. Costs of these two areas are allocated to the revenue producing departments. Personnel costs are allocated using number of employees; administration costs are allocated using direct department costs. The following annual budgeted information (presented in a benefits-provided ranking) is available: Direct costs Number of employees Direct labor hours Square feet cleaned Personnel Administration Residential Commercial $252.000 22 $324,000 $864,000 $1,440.000 54 130 108.000 $10,000 162,000 1,026,000 a. Using the direct method, allocate the costs of Personnel and Administration to the Residential and Commercial divisions. Note: Do not round proportions; round your final answer to the nearest whole dollar. Total support costs allocated to Residential 5 Total support costs allocated to Commercial $ 151,200 121,500 b. Using the step method, allocate the costs of Personnel and Administration to the Residential and Commercial divisions Note: Do not round proportions: round your final answer to the nearest whole dollar Type here to search 93PM 65 Mostly dear A b. Using the step method, allocate the costs of Personnel and Administration to the Residential and Commercial divisions. Note: Do not round proportions; round your final answer to the nearest whole dollar. Total support costs allocated to Residential Total support costs allocated to Commercial- c. Salado prices jobs by the direct labor hour for Residential services and by the square foot cleaned for Commercial services. Compute the full cost of providing one direct labor hour of service for Residential and for one square foot cleaned for Commercial using (1) the direct method and (2) the step method. Note: Round your answers to two decimal places (i.e. round $4.555 to $4.56). (1) Direct Method Residential cost per hour of service Commercial cost per square foot cleaned (2) Step Method Residential cost per hour of service 0x Commercial cost per square foot cleaned s 0x Check Type here to search 935PM 85F Mostly clear Question 14 Not complete Marked out of 0.71 P Flag question Comprehensive support department allocations Management at C. Pier Press has decided to allocate costs of the paper's two support departments (administration and human resources) to the two revenue-generating departments (advertising and circulation). Administration costs are to be allocated on the basis of dollars of assets employed; human resources costs are to be allocated on the basis of number of employees. The following costs and allocation bases are available: Department Direct Costs Number of Employees Assets Employed Administration $781,500 Human resources 492,700 Advertising 957,800 Circulation 1,352.600 Totals $3,584,600 10 $387,100 8 291,700 12 762,400 26 1,870.300 56 $3,311,500 a. Using the direct method, allocate the support department costs to the revenue-generating departments. Note: Round percentages in your calculation to the nearest whole percent (for example, round 34.5% to 35%). Note: Round your final answer to the nearest whole dollar. Total service costs allocated to Advertising: 0 9:36PM 85F Mostly clear a. Using the direct method, allocate the support department costs to the revenue generating departments. Note: Round percentages in your calculation to the nearest whole percent (for example, round 34.5% to 35%). Note: Round your final answer to the nearest whole dollar. Total service costs allocated to Advertising: 0 Total service costs allocated to Circulation: 0 b. Using your answer to (a), what are the total costs of the revenue-generating departments after the allocations? Advertising total costs $ 0 Circulation total costs $ 0 c. Assuming that the benefits-provided ranking is the order shown in the table, use the step method to allocate the support department costs to the revenue-generating departments. Enter the total amount of service department costs (Administration and Human Resources) allocated to revenue-generating departments (Advertising and Circulation). Note: Round your final answers only to the nearest whole dollar. Total service costs allocated to Advertising, so Total service costs allocated to Circulation: $ 0 Type here to search 36PM BSF Mostly dear 72/2002 d. Using your answer to (c), what are the total costs of the revenue-generating departments after the allocations? Advertising total costs $ 0 Circulation total costs $0 e. Using the algebraic method, allocate the support department costs to the revenue-generating departments. Enter the total amount of service department costs (Administration and Human Resources) allocated to revenue-generating departments (Advertising and Circulation). Note: Round percentages in your calculation to the nearest whole percent (for example, round 34.5% to 35%). Note: Round your final answer to the nearest whole dollar. Total service costs allocated to Advertising: 0 Total service costs allocated to Circulation: $0 f. Using your answer to (e), what are the total costs of the revenue generating departments after the allocations? Advertising total costs $ 0 Circulation total costs $ 0. type here to search 9 35F Morty car
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