Other information pertaining to logo is as follows

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Facilities Department are allocated based on square feet occupied (in thousands). Other information pertaining to Logo is as follows. Computer Square Feet Department Overhead Usage Hours Occupied Systems $200,000 300 1,000 Facilities 100,000 900 600 Machining 400,000 3,600 2,000 Assembly 550,000 1,800 3,000 Finishing 620,000 2,700 5,000 9,300 11,600 If Logo employs the direct method of allocating service department costs, the overhead of the Systems Department would be allocated by dividing the overhead amount by a. 1,200 hours. b. 8,100 hours. c. 9,000 hours. d. 9,300 hours. 254. CSO: 1D3d LOS: 1D3p Adam Corporation manufactures computer tables and has the following budgeted indirect manufacturing cost information for next year. Support Departments Operating Departments Total Maintenance Systems Machining Fabrication Budgeted overhead $360,000 $95,000 $200,000 $300,000 $955,000 Support work furnished From Maintenance 10% 50% 40% 100% From Systems 5% 45% 50% 100% If Adam uses the step-down method, beginning with the Maintenance Department, to allocate support department costs to production departments, the total overhead (rounded to the nearest dollar) for the Machining Department to allocate to its products would be a. $415,526. b. $422,750. c. $442,053. d. $445,000.
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103 255. CSO: 1D3d LOS: 1D3p Wilcox Industrial has two support departments, the Information Systems Department and the Personnel Department, and two manufacturing departments, the Machining Department and the Assembly Department. The support departments service each other as well as the two production departments. Company studies have shown that the Personnel Department provides support to a greater number of departments than does the Information Systems Department. If Wilcox uses the direct method of departmental allocation, which one of the following cost allocations would occur? Some of the costs of the a. Personnel Department would be allocated to the Information Systems Department. b. Machining Department would be allocated to the Information Systems Department. c. Information Systems Department would be allocated to the Assembly Department. d. Assembly Department would be allocated to the Machining Department. 256. CSO: 1D3d LOS: 1D3p Logo Inc. has two data services departments (the Systems Department and the Facilities Department) that provide support to the company’s three production departments (Machining Department, Assembly Department, and Finishing Department). The overhead costs of the Systems Department are allocated to other departments on the basis of computer usage hours. The overhead costs of the Facilities Department are allocated based on square feet occupied (in thousands). Other information pertaining to Logo is as follows. Computer Square Feet Department Overhead Usage Hours Occupied Systems $200,000 300 1,000 Facilities 100,000 900 600 Machining 400,000 3,600 2,000 Assembly 550,000 1,800 3,000 Finishing 620,000 2,700 5,000 9,300 11,600 Logo employs the step-down method of allocating service department costs and begins with the Systems Department. Which one of the following correctly denotes the amount of the Systems Department’s overhead that would be allocated to the Facilities Department and the Facilities Department’s overhead charges that would be allocated to the Machining Department?
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