Printem Forestland Wood Products manufactures lumber and wood components. The company has two main product lines: Hardwood and Softwood. Hardwoods are used for flooring, cabinetry, paneling, doors and trimwork. Softwoods are used for wall studs, joists, planks, rafters, beams, stringers, posts, decking, subflooring and concrete forms. Forestland also sells a by product, wood shavings and saw dust. Shavings are purchased for farm and industrial use as well as for further processing into wood pellets and fiber board. The revenue is allocated to each product line based on the percentage of thousand board feet produced by the product line. Your accounting firm has been retained by Forestland for three years. You have been assigned to properly allocate support department costs. Your manager wants the allocation to be as accurate as possible and has instructed you to use the reciprocal services method. She reminds you that revenue from by-products are used to offset costs. You begin your research and leam that there are four production departments: log yard, milling, drying, and packaging. The Hardwood line produces 300 thousand board feet of product while the Softwood produces 900 thousand board feet. The milling department direct costs, direct labor and overhead per thousand board feet for Hardwood is two times that of Softwood. You have been instructed to use the weighted average method to allocate the costs in the milling department between the two product lines. The remaining department costs are the same for both product lines, per thousand board feet. There are two support departments; maintenance and administration. The maintenance department is responsible for maintaining all equipment and janitorial duties. Because the equipment is used more extensively for hardwoods, the department cost driver is hours worked. The administration department includes the company president and his staff. Their duties include accounting, human resources, and information technology. The cost driver for the administration department is number of employees. In your first step, you determine the costs traced to each department and the usage of the support department cost drivers. You have created the following table: Hours worked Number of employees Department costs Maintenance 11,825 B $176,000 Administration Log Yard Milling 8,910. 10,692 23,166 Drying 28,512 Packaging 17,820 S 6 12 16 8 $216,275 $309,940 $747,000 $433,160 $224,000 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 foaming tables Maintenance Maintenance Department Hews Worked Usage Percent 8,910 10 Ing Yere 10,692 12 Milling 23,166 V 26 Drying 28,512 32 Padaging 17,820 20 Total 89,100 100 Administration Department of Employers Usage Percent 16 12 Lagar Milling Drying Packaging Total 17 24 16 V 32 16 v 100 % Using the cells below, create the farmales that will ammultaneously allocate support department costs among the departments represents and "Aments Print Administration Department of Employees Usage Percent Maintenance 16 V Log Yard 6 17 Milling Drying 12 24 V 16 32 V Packaging Totals 50 v 16 V 100 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-S + 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 11,825 8,910 v 10,692 Number of employees B 5 V 6 V 23,166 12 28,512 17,820 16 Department cost 176,000 216,275 309,940 747,000 433,160 224,000 Maintenance Administration Final department costs Foodiak Check My Wor Multiply the total cost to be allocated from a support department by the percentage of that cost consumed by the other support department and each of the production departments to find the amount allocated to each department. What should be the total cost remaining in a support department when the allocation process is finished? Uong the rounded amounts from the support cost allocation table (previous task), complete the following table to alocate the production department costs to each product boe Bound allocated amounts to the nearest whole dollar) Log Yard Hardwood Softwood ital Log Milling Hardwood Soltwood Total Milling Drying Harwood Softwood Total Drying Packaging Hardwood Softwood Total Packaging Check My Work Thousand Board Feet Weight Factor Weighted Thous. Bd. Ft. Weighted of Board Feet Final Department Costs Cost Allocation to Product Line Forest Land earns revenue of $100,000 from selling its by-products, wood shavings and saw dust. Allocate the revenue to each product lee in the following table and determine the final cost per product line. Portion of By Thousand Board Feet Percentage of Board Feet By product Revenue product Revenue Hardwood % $100,000 100,000 Softwood Total Log Yard Milling Drying Packaging Subtotal Portion of By-product revenue Total cost per product line Cost per Product Line Hardwood Softwood