In the above example administration would be

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Unformatted text preview: g between two cost center arrangements. The first possibility is to make the entire organization into one cost center; the second is to use three cost centers: mowing, special projects, and administration. Cost data are available for administrative supplies ($14,425), mowing supplies ($13,575), special project supplies ($12,000), administrative salaries ($40,000), mowing salaries ($50,000), special project salaries ($35,000), and the contracted maintenance services for the trucks the company uses to transport its mowers to job sites ($10,000). ____________________________________________________________________________________________________________ David W. Young • Management Accounting for Managers • Chapter 1 Page 7 Copyrighted Material. Do not reproduce without written permission. As with the prior problem, the company provided 15,625 hours of lawn care services (11,772 hours of mowing plus 3,853 hours of special projects) last year. What would its the costs be under the one-cost-center ap...
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This document was uploaded on 03/30/2014.

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