Perry Company has two service departments, Maintenance and Human Resources, and two production departments, Machining and...
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Perry Company has two service departments, Maintenance and Human Resources, and two production departments, Machining and Assembly. The following data have been estimated for next year's operations: Department: Direct Charges $135,000 100,000 Square Footage Labor Hours Human Resources Maintenance 5,000 Machining Assembly 275,000 2,000 20,000 225,000 3,000 25,000 The Human Resources Department services all departments. Requirements: (1) (2) Distribute the service department costs using the direct distribution method. Distribute the service department costs using the sequential distribution method with the department servicing the greatest number of other departments being distributed first. Using the results from the direct distribution method, calculate the predetermined factory overhead rate for the machining department using labor hours as the basis. (3) Perry Company has two service departments, Maintenance and Human Resources, and two production departments, Machining and Assembly. The following data have been estimated for next year's operations: Department: Direct Charges $135,000 100,000 Square Footage Labor Hours Human Resources Maintenance 5,000 Machining Assembly 275,000 2,000 20,000 225,000 3,000 25,000 The Human Resources Department services all departments. Requirements: (1) (2) Distribute the service department costs using the direct distribution method. Distribute the service department costs using the sequential distribution method with the department servicing the greatest number of other departments being distributed first. Using the results from the direct distribution method, calculate the predetermined factory overhead rate for the machining department using labor hours as the basis. (3)
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Related Book For
Management Accounting Information for Decision-Making and Strategy Execution
ISBN: 978-0137024971
6th Edition
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young
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