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Required information (The following information applies to the questions displayed below.) Great Ape Glassworks manufactures glass used for the screens on smartphones. It has two
Required information (The following information applies to the questions displayed below.) Great Ape Glassworks manufactures glass used for the screens on smartphones. It has two producing departments, P1 and P2, and only one service department, S1. The company is able to track overhead to the various departments but wants to allocate the service department costs to the producing departments. However, the company is not sure which of the multiple allocation bases should be selected. The data it collected appear in the table below. Overhead Assigned $ 163,500 270,250 83,000 Department P1 P2 S1 Potential allocation base Employee headcount Space used (in square feet) Productive capacity (in units) 3-year average percentage of S1 output used P1 48 5,100 40,200 60% P2 32 11,900 93,800 40% Required: 1. Determine the total estimated overhead cost for each of the producing departments after allocating the cost of the service department: a. Using employee headcount as the allocation base. b. Using occupied space as the allocation base. c. Using productive capacity as the allocation base. d. Using the 3-year average use as the allocation base. P1 P2 Total a. Using employee headcount as the allocation base b. Using occupied space as the allocation base C. Using productive capacity as the allocation base d. Using the 3-year average use as the allocation base
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