Question
THE FOLLOWING INFORMATION IS USED FOR QUESTIONS 1 3. Quiz Companys manufacturing process is organized into two producing departments (P1 and P2) and two service
THE FOLLOWING INFORMATION IS USED FOR QUESTIONS 1 3.
Quiz Companys manufacturing process is organized into two producing departments (P1 and P2) and two service departments (S1 and S2). Overhead costs from S1 are allocated based on machine hours. Overhead costs from S2 are allocated based on square footage. The following information is available for the four departments.
Service Departments Producing Departments S1S2 P1P2Overhead cost$150,000$160,000 $98,000$56,000Machine hours2,0001,000 6,9003,100Square footage2,0001,700 4,0006,000
Note: For all questions, round allocation ratios to four decimal points and round all dollar amounts to the nearest dollar.
Determine the total overhead cost for P1 using the direct method to allocate service department costs.
Note: Give your answer using dollar signs and commas but no decimal points (cents).
Example: $12,345
Determine the total overhead cost for P1 using the sequential method to allocate service department costs. Begin with the department with the higher cost.
Determine the total overhead cost for P1 using the reciprocal method to allocate service department costs.
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