{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-06T08:46:08-04:00", "answer_date": "2024-06-06 08:46:08", "is_docs_available": "", "is_excel_available": "", "is_pdf_available": "", "count_file_available": 0, "main_page": "student_question_view", "question_id": "2353220", "url": "\/study-help\/questions\/425a-algo-fairness-and-cost-pool-allocations-lo-41-42-2353220", "question_creation_date_js": "2024-06-06T08:46:08-04:00", "question_creation_date": "Jun 06, 2024 08:46 AM", "meta_title": "[Solved] 4-25A (Algo) Fairness and cost pool alloc | SolutionInn", "meta_description": "Answer of - 4-25A (Algo) Fairness and cost pool allocations LO 4-1, 4-2, 4-3, 4-5 Vernon Manufacturing Company uses two department | SolutionInn", "meta_keywords": "4-25a,algo,fairness,cost,pool,allocations,lo,4-1,4-2,4-3,4-5,vernon", "question_title_h1": "4-25A (Algo) Fairness and cost pool allocations LO 4-1, 4-2, 4-3, 4-5 Vernon Manufacturing Company uses two departments to make its products. Department I is", "question_title": "4-25A (Algo) Fairness and cost pool allocations LO 4-1, 4-2, 4-3, 4-5", "question_title_for_js_snippet": "4 25A (Algo) Fairness and cost pool allocations LO 4 1, 4 2, 4 3, 4 5 Vernon Manufacturing Company uses two departments to make its products Department I is a cutting department that is machine intensive and uses very few employees Machines cut and form parts and then place the finished parts on a conveyor belt that carries them to Department II, where they are assembled into finished goods The assembly department is labor intensive and requires many workers to assemble parts into finished goods The company's manufacturing facility incurs two significant overhead costs employee fringe benefits and utility costs The annual costs of fringe benefits are $316,000 and utility costs are $244,000 The typical consumption patterns for the two departments are as follows Machine hours used Direct labor hours used Department I 14,400 6,600 Department II 5,600 9,400 Total 20,000 16,000 The supervisor of each department receives a bonus based on how well the department controls costs The company's current policy requires using a single allocation base (machine hours or labor hours) to allocate the total overhead cost of $560,000 Required a Assume that you are the supervisor of Department I Choose the allocation base that would minimize your department's share of the total overhead cost Calculate the amount of overhead that would be allocated to both departments using the base that you selected b Assume that you are the supervisor of Department II Choose the allocation base that would minimize your department's share of the total overhead cost Calculate the amount of overhead that would be allocated to both departments using the base that you selected c Assume that you are the plant manager and have the authority to change the company's overhead allocation policy Formulate an overhead allocation policy that would be fair to the supervisors of both Department I and Department II Compute the overhead allocations for each department using your policy", "question_description": "\"image 4-25A (Algo) Fairness and cost pool allocations LO 4-1, 4-2, 4-3, 4-5 Vernon Manufacturing Company uses two departments to make its products. Department I is a cutting department that is machine intensive and uses very few employees. Machines cut and form parts and then place the finished parts on a conveyor belt that carries them to Department II, where they are assembled into finished goods. The assembly department is labor intensive and requires many workers to assemble parts into finished goods. The company's manufacturing facility incurs two significant overhead costs: employee fringe benefits and utility costs. The annual costs of fringe benefits are $316,000 and utility costs are $244,000. The typical consumption patterns for the two departments are as follows: Machine hours used Direct labor hours used Department I 14,400 6,600 Department II 5,600 9,400 Total 20,000 16,000 The supervisor of each department receives a bonus based on how well the department controls costs. The company's current policy requires using a single allocation base (machine hours or labor hours) to allocate the total overhead cost of $560,000. Required a. Assume that you are the supervisor of Department I. Choose the allocation base that would minimize your department's share of the total overhead cost. Calculate the amount of overhead that would be allocated to both departments using the base that you selected. b. Assume that you are the supervisor of Department II. Choose the allocation base that would minimize your department's share of the total overhead cost. Calculate the amount of overhead that would be allocated to both departments using the base that you selected. c. Assume that you are the plant manager and have the authority to change the company's overhead allocation policy. Formulate an overhead allocation policy that would be fair to the supervisors of both Department I and Department II. Compute the overhead allocations for each department using your policy", "transcribed_text": "", "related_book": { "title": "Taxation Of Individuals And Business Entities 2015", "isbn": "978-1259206955, 1259206955, 77862368, 978-0077862367", "edition": "6th Edition", "authors": "Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver", "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/1169.jpg", "uri": "\/textbooks\/taxation-of-individuals-and-business-entities-2015-6th-edition-9780077862367", "see_more_uri": "" }, "free_related_book": { "isbn": "161865876X", "uri": "\/textbooks\/nclex-pn-2015-20-strategies-practice-and-review-with-practice-test-1st-edition-978-1618658760-333871", "name": "Nclex Pn 2015 20 Strategies Practice And Review With Practice Test", "edition": "1st Edition" }, "question_posted": "2024-06-06 08:46:08", "see_more_questions_link": "\/study-help\/questions\/business-management-leadership-2023-June-05", "step_by_step_answer": "The Answer is in the image, click to view ...", "students_also_viewed": [ { "url": "\/1-what-physical-control-methods-are-used-to-sterilize-what", "description": "1. 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