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Maintenance Administration Log Yard Milling Drying Packaging Hours worked 11,825 10,692 8,910 28,512 23,166 17,820 Number of employees 6 4 4 10 12 8 Department

  1. Maintenance Administration Log Yard Milling Drying Packaging
    Hours worked 11,825 10,692 8,910 28,512 23,166 17,820
    Number of employees 6 4 4 10 12 8
    Department costs $193,600 $237,900 $340,950 $521,400 $476,450 $246,400

    Your next step is to determine the proportional usage of each support department's cost driver by the other departments to which its costs are to be allocated. Complete the following tables.

    Maintenance
    Department Hours Worked
    • Hours Worked
    • # of Employees
    Usage Percent
    Administration
    • Administration
    • Maintenance
    %
    Log Yard
    Milling
    Drying
    Packaging
    Totals %
    Administration
    Department # of Employees
    • Hours Worked
    • # of Employees
    Usage Percent
    Maintenance
    • Administration
    • Maintenance
    %
    Log Yard
    Milling
    Drying
    Packaging
    Totals %

    Using the cells below, create the formulas that will simultaneously allocate support department costs among the departments. "M" represents Maintenance and "A" represents Administration.

    M = $ + (% A

    • A
    • M
    )

    A = $ + (% M

    • A
    • M
    )

    Solve the equations, If required round any decimal to three places in your computations. For example, .0183 would be rounded to .018. Round your final answer to the nearest dollar.

    M = $

    A = $

    Use the following table to allocate the support cost departments. Round allocated amounts to the nearest whole dollar. If an amount is zero, enter "0".

    Support Departments Production Departments
    Maintenance Administration Log Yard Milling Drying Packaging
    Hours worked
    Number of employees
    Department cost $ $ $ $ $ $
    Maintenance
    Administration
    Final department costs $ $ $ $ $ $

    Using the rounded amounts from the support cost allocation table (previous task), complete the following table to allocate the production department costs to each product line. Round allocated amounts to the nearest whole dollar.

    Thousand Board Feet Weight Factor Weighted Thous. Bd. Ft. Weighted % of Board Feet Final Department Costs Cost Allocation to Product Line
    Log Yard:
    Hardwood % $ $
    Softwood
    Total Log Yard % $
    Milling:
    Hardwood % $ $
    Softwood
    Total Milling % $
    Drying:
    Hardwood % $ $
    Softwood
    Total Drying % $
    Packaging:
    Hardwood % $ $
    Softwood
    Total Packaging % $

    Forest Land earns revenue of $100,000 from selling its by-products, wood shavings and saw dust. Allocate the revenue to each product line in the following table and determine the final cost per product line.

    Thousand Board Feet Percentage of Board Feet By-product Revenue Portion of By- product Revenue
    Hardwood % $100,000 $
    Softwood 100,000
    Total % $
    Cost per Product Line
    Hardwood Softwood
    Log Yard $ $
    Milling
    Drying
    Packaging
    Subtotal $ $
    Portion of By-product revenue
    Total cost per product line $ $

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