Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Cornerstone Exercise 7.1 (Algorithmic) Calculating and Using a Single Charging Rate The expected costs for the Maintenance Department of Stazler, Inc., for the coming year

Cornerstone Exercise 7.1 (Algorithmic) Calculating and Using a Single Charging Rate

The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include:

Fixed costs (salaries, tools): $71,680 per year
Variable costs (supplies): $1.30 per maintenance hour
Estimated usage by:
Assembly Department 5,000
Fabricating Department 6,000
Packaging Department 11,400
Total maintenance hours 22,400
Actual usage by:
Assembly Department 3,500
Fabricating Department 6,100
Packaging Department 10,600
Total maintenance hours 20,200

Required:

1. Calculate a single charging rate for the Maintenance Department. Round your answer to the nearest cent. $ per maintenance hour

2. Use this rate to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year. $

3. What if the Assembly Department used 3,550 maintenance hours in the year? How much would have been charged out to the three departments?

Assembly Department charge $
Fabricating Department charge
Packaging Department charge
Total amount charged

$

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Governmental And Nonprofit Accounting Theory And Practice

Authors: Robert J Freeman, Craig D Shoulders, Gregory S Allison, Terry K Patton, Robert Smith,

9th Edition

0132552728, 9780132552721

More Books

Students also viewed these Accounting questions

Question

What are the components of an ANOV table?

Answered: 1 week ago