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3 Problem 11B-5 Service Department Charges [L011-6) 10 points Tasman Products. Ltd of Australia has 8 Maintenance Department that services the equipment in the company's
3 Problem 11B-5 Service Department Charges [L011-6) 10 points Tasman Products. Ltd of Australia has 8 Maintenance Department that services the equipment in the company's Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below. Data for the Maintenance Department follow: variable costs for ubricants Fixed costs for salaries and other Budget Actual $271,888 347,348 5192,8ee $2e6,288 Budgeted at $18 per machine-hour. Data for the Forming and Assembly Departments follow: Percentage of Peak-Period Forming Department 1e,5ee 12,5e0 Total 189 The level of fixed costs in the Maintenance Department is determined by pesk-period requirements. Requlred: Management would like data to assist in comparing actual performance to planned performance in the Maintenance Depertment and in the other departments. 1. How much Maintenance Department cost should be charged to the Forming Department and to the Assembly Department? 2 How much, ir any, of the actual Maintenance Department costs for the year shouid be treated as a spending variance and not charged to the Forming and Assembly depsrtments? Complete this question by entering your answers in the tabs below. Requirad 1 Required 2 How much Maintenance Department cost should be charged to the Forming Department and to the Assembly Department? Total cost charged Required! Required 2
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