Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Could someone help me and explain the process? Thank you! Reciprocal Method of Support Department Cost Allocation Chekov Company has two support departments, Human Resources

image text in transcribedimage text in transcribedimage text in transcribed

Could someone help me and explain the process? Thank you!

Reciprocal Method of Support Department Cost Allocation Chekov Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly. The costs of the Human Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of footage. Now assume that Chekov Company uses the reciprocal methon to department costs. Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the reciprocal method. If an amount is zero, enter "0". Use the rounded values for subsequent calculations. 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the reciprocal method. If an amount is zero, enter " 0 ". Use the rounded values for subsequent calculations. 2. Develop a simultaneous equations system of total costs for the support departments. If required, round your answers to four decimal places. Use these numbers for subsequent calculations. If required, round all other intermediate calculations to six decimal places, except the answers computed in requirement 1. Human Resources (HR)=$+(GF) General Factory (GF) =$+(HR) Solve for the total reciprocated costs of each support department. (Round reciprocated total costs to the nearest dollar.) Human Resources (HR) General Factory (GF) 3. Using the reciprocal method, allocate the costs of the Human Resources and General Factory departments to the Fabricating and Assembly departments. Round all allocated costs to the nearest dollar. If an amount is zero, enter " 0 ". Note: There may be a " $1" difference due to intermediate rounding. Direct costs Allocate: Human Resources General Factory

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Accounting questions