Young management accounting for managers chapter 1

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Unformatted text preview: pecial Projects Total SalaryDollars $50,000 35,000 $85,000 x x x Rate $0.605 $0.605 = = = Allocation $30,250 21,175 $51,425 Note that the full $51,425 has been fully allocated to Mowing and Special Projects. Also note that if we were to use the salary costs in Administration, as well as in Mowing, and Special Projects, to determine the allocation rate, the rate would not allow us to fully allocate the $51,425. ••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••• If you do not understand why the $40,000 in Administration salaries are excluded from the denominator in calculating the rate, you should carry out the allocation of the Administration cost center including the $40,000 in the denominator, and obs...
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This document was uploaded on 03/30/2014.

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