2010-08-27_065103_12-59

2010-08-27_065103_12-59 - Chapter 12 Decision guidelines...

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Unformatted text preview: Chapter 12 Decision guidelines Dallas Cleaning Cost allocations from service departments to producing departments 8/27/2010 Direct department costs Number of employees Direct method Direct department costs Personnel allocation Administrative allocation Total costs Step-down method Direct depratment costs Step 1-Personnel Allocation Step 2-Administrative Allocation Total Costs Administrat Commercia Total Personnel ive Residential l Res/Comm $70,000.00 $90,000 $240,000 $400,000 $640,000 6 10 36 24 60 $70,000 -70,000 $- $70,000 -70000 $- $90,000 -90,000 $- $90,000 10000 -100,000 $- $240,000 $42,000 $33,750 $315,750 $400,000 28000 56250 $484,250 $240,000 $400,000 36000 24000 37500 62500 $313,500 $486,500 $640,000 1. What are the total costs for the Residential department using the direct method? $315,750 the total costs for the Residential department using the step-down method? 2. What are $313,500 3. What are the total costs for the Commercial department using the step-down method? $486,500 4. Which method would you recommend that Antonio Cleaning use to allocate their service departments’ costs to the Antonio cleaning should use step-down method as this method it reallocates costs to other service departm partments Total Admn/Res/Comm Grand total $800,000 70 $730,000 $800,000 0 0 $800,000 $730,000 $800,000 0 0 $800,000 artments’ costs to their producing departments? Why? her service departments which render services to it. ...
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This note was uploaded on 06/20/2011 for the course ACCT 101 taught by Professor Joannes during the Spring '11 term at Aarhus Universitet.

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