Question
. NewCo. has two operating (production) departments supported by a number of service departments. The following information was collected for a recent period: Direct Costs
. NewCo. has two operating (production) departments supported by a number of service departments. The following information was collected for a recent period: Direct Costs by Dept. Indirect Costs to be allocated
Machinery Dept Assembly Dept between both Depts
Salaries $122,400 $85,700 $36,700
Insurance 20,200 11,000 5,500
Utilities 23,900 13,900 2,000
Depreciation 20,700 11,500 13,800
Maintenance 7,000 4,700 29,400
Office expenses -0- -0- 71,100
Cost of goods sold 327,600 121,200
Indirect costs are allocated as follows: salaries on the basis of sales, office expenses on the basis of the number of employees, and all other costs (insurance, utilities, depreciation and maintenance) on the basis of square footage. Additional information about the production departments follows:
Square Footage | Number of Employees | |
Machining | 14,535 | 78 |
Assembly | 4,845 | 52 |
Sales for the Machining Department are $724,404 and sales for the Assembly Department are $356,796. Determine the departmental net income for each production department. Use the template below. Show your work for indirect expenses for credit. (8 points). Check: Gross profit for Machinery Dept should be $396,804. Net income for Machinery Dept should be a number between $96,000 and $98,000. Net income for Assembly Dept should be a number greater than $55,000.
Fill the below form out:
Machinery Dept. Assembly Dept.
Sales
Cost of goods sold
Gross profit
Direct expenses:
Salaries
Insurance
Utilities
Depreciation
Maintenance
Total direct expenses
Indirect expense allocations:
Salaries
Insurance
Utilities
Depreciation
Maintenance
Office expenses
Total indirect expenses
Net income
ACC212CH22A(2) [Compatibility Mode] - Word FILE HOME INSERT DESIGNPAGE LAYOUT REFERENCES MAILINGS REVIEW VIEW katherinejones Cut #4 Find AaBbCcD AaBbCcD AaBbCcD opy ac Replace Paste :, 2 m | TNormal TNoSpac Heading 1 Heading 2 Title Subtitle Subtle Em Emphasis Format Painter Select Clipboard Font Paragraph Styles Editing UPDATES AVAILABLE Updates for Office are ready to be installed, but first we need to close some apps. Update now 7. NewCo. has two operating (production) departments supported by a number of service departments. The following information was collected for a recent period Indirect Costs to be allocated Direct Costs by Dept. Machinery Dept Assembly Dept between both Depts Salaries Insurance Utilities Depreciation Maintenance Office expenses Cost of goods sold $122,400 20,200 23,900 20,700 7,000 0- 327,600 $85,700 11,000 13,900 11,500 4,700 $36,700 5,500 2,000 13,800 29,400 71,100 121,200 Indirect costs are allocated as follows: salaries on the basis of sales, office expenses on the basis of the number of employees, and all other costs (insurance, utilities, depreciation and maintenance) on the basis of square footage Additional information about the production departments follows Square Footage 14,535 4,845 Number of Employees 78 52 Machining Assembly PAGE 3 OF 4 36 OF 680 WORDS + 100% 10:03 PM 10/4/2016Step by Step Solution
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