Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sharp Motor Company has a cafeteria that serves two operating divisions - an Auto Division and a Truck Division. The costs of operating the cafeteria

Sharp Motor Company has a cafeteria that serves two operating divisions-an Auto Division and a Truck Division. The costs of operating the cafeteria are budgeted at $87,000 per month plus $0.60 per meal served.
The fixed costs of the cafeteria are determined by peak-period requirements. The Auto Division is responsible for 68% of the peakperiod requirements, and the Truck Division is responsible for the other 32%.
For June, the Auto Division estimated it would need 94,000 meals, and the Truck Division estimated it would need 64,000 meals. However, due to unexpected layoffs of employees during the month, only 64,000 meals were served to the Auto Division. Another 64,000 meals were served to the Truck Division as planned.
The cafeteria's actual fixed costs for June totaled $91,000 and its actual meal cost
Required:
How much cafeteria cost should be charged to each division for June?
Assume the company follows the practice of allocating all cafeteria costs to the divisions based on the number of meals served. On this basis, how much cost would be allocated to each division for June?
Note: Round your intermediate calculations to 2 decimal places.
\table[[,\table[[Auto],[Division]],\table[[Truck],[Division]]],[1. Total cost charged,,],[2. Total cost allocated,,]]
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Accounting questions

Question

Java based on the test what is wrong with this code.

Answered: 1 week ago