Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and

image text in transcribed
image text in transcribed
Sequential (Step) Method of Support Department Cost Allocation Valron Company has two support departments, Human Resources and General Factory, and two producing departments, Fabricating and Assembly Producing Departments Support Departments Human General Resources Factory $170,000 $360,000 Fabricating Assembly Direct costs $114,500 $94,000 Normal activity: Number of employees Square footage 40 70 170 1,300 5,900 13,800 Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Now assume that Vairon Company uses the sequential method to allocate support department costs. The support departments are ranked in order of highest cost to lowest cost. Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the sequential method. If an amount is zero, enter "O". Use the rounded values for subsequent calculations. Proportion of Driver Used by General Factory Fabricating Human Resources Asse Human Resources General Factory 2. Using the sequential method, allocate the costs of the Human Resources and General Factory departments to the Fabricating and Assembly departments. If an amount is zero, enter"0". Round your answers to the nearest dollar Support Departments Producing Departr A: Human Resources Fabricating General Factory Direct costs Support Departments Producing Departments Human General Factory Fabricating Assembly Resources $170,000 $360,000 $114,500 594,000 Direct costs 40 70 170 Normal activity: Number of employees Square footage 5,900 13,800 1,300 Resources Department are allocated on the basis of number of employees, and the costs of General Factory are allocated on the basis of square footage. Now assume that Valron Company uses the sequential method to allocate support department costs. The support departments are ranked in order of highest cost to lowest cost. Required: 1. Calculate the allocation ratios (rounded to four significant digits) for the four departments using the sequential method. If an amount is zero, enter "o". Use the rounded values for subsequent calculations Proportion of Driver Used by Human Resources General Factory Fabricating Assei Human Resources General Factory 2. Using the sequential method, allocate the costs of the Human Resources and General Factory departments to the Fabricating and Assembly departments. If an amount is zero, entero". Round your answers to the nearest dollar Support Departments Producing Departmer Human Resources General Factory Fabricating Assei Direct costs si Allocate: General Factory in Human Resources Total after allocation

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

Managerial Accounting Creating Value in a Dynamic Business Environment

Authors: Ronald Hilton, David Platt

10th edition

78025664, 978-0078025662

More Books

Students also viewed these Accounting questions

Question

6. Explain what causes unsafe acts.

Answered: 1 week ago