Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Personnel Department at Hernandez Bros. is centralized and provides services to the two operating units: Miami and New York. The Miami unit is the

image text in transcribed
The Personnel Department at Hernandez Bros. is centralized and provides services to the two operating units: Miami and New York. The Miami unit is the original unit of the company and is well established. The New York unit is new, much like a start-up company. The costs of the Personnel Department are allocated to each unit based on the number of employees in order to determine unit profitability. The current rate is $640 per employee. Data for the fiscal year just ended show the following Required: o. Compute the cost allocoted to each unit using the current allocation system. b. Livon, the manager of the Miami unit, is unhappy with the allocation from Personnel. He believes that he gets ittie benefit other than the occasional hire and termination help. He asiss the controller's office to estimate the amount of Personnel Department cost associated with routine persontel matters (benefits, and so on) and those associated with hiring employees and assisting with departing employees (transitions). The controller responds that if they separated the overhead costs on this basis, the rates would be $340 per employee for routine matters and $6,675 for each transition (each hiring and each departure counts as one transition). Reconpute the costs allocated to each unit using the separate rates for routine and transaional matters

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

Accounting And Financial Management For Residential Construction

Authors: Emma Shinn

5th Edition

0867186356, 978-0867186352

More Books

Students also viewed these Accounting questions

Question

Describe contextual influences on direct financial compensation.

Answered: 1 week ago

Question

Describe legally required benefits.

Answered: 1 week ago

Question

Discuss career development and career development methods.

Answered: 1 week ago