Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Manning Products, inc, operates an electric power plant that provides all electrical power for the company's machining and fabrication departments. Information on kwh of power

Manning Products, inc, operates an electric power plant that provides all electrical power for the company's machining and fabrication departments. Information on kwh of power usage in these departments for May follows:

Machinig Fabrication Total
Budgeted kwh 180,000 60,000 240,000
Actual kwh used 200,000 50,000 250,000

The costs of electric power plant are all fixed. The level of budgeted fixed costs is determined by the peak-period requirements. Budgeted fixed costs for May totaled $120,000. Actual fixed costs for the month totaled $130,000. The Machining Department requires 70% of the peak-period capacity and the Fabrication Departments requires 30%.

For performance evaluation purposes, how much of the electric power plant's fixed costs should be charged to the Fabrication Department at the end of the month?

a) $44,000

b) $36,000

c) $91,000

d) $97,500

Please show all steps.

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

Case Studies In Forensic Accounting And Fraud Auditing

Authors: Professor D. Larry Crumbley, Wilson LaGraize, Christopher E. Peters

2nd Edition

0808041932, 978-0808041931

More Books

Students also viewed these Accounting questions