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There are two basic activities in the Personnel Department. The first, called employee maintenance, manages employee records. Virtually all of this activity occurs when
There are two basic activities in the Personnel Department. The first, called employee maintenance, manages employee records. Virtually all of this activity occurs when employees are hired or leave the company. The other activity is payroll, which is an ongoing activity and requires the same amount of work for each employee regardless of the employee's salary. Assorted data for LastCall for the last year follow. Number of employees (average) Employees hired/leaving LaidBack 100 StressedOut 25 Total 125 5 11 16 The Personnel Department incurred the following costs during the year. Employee maintenance Payroll Total $112,000 12,500 $124,500 Required: a. Under the current allocation system, what are the costs that will be allocated from personnel to LaidBack? To Stressed Out? b. Suppose the company implements an activity-based cost system for personnel with the two activities, employee maintenance and payroll. Use the number of employees hired/leaving as the cost driver for employee maintenance costs and the average number of employees for payroll costs. What are the costs that will be allocated from personnel to Laid Back? To Stressed Out? Complete this question by entering your answers in the tabs below. Required A Required B Under the current allocation system, what are the costs that will be allocated from personnel to Laid Back? To Stressed Out? (Do not round intermediate calculations and round your answers to the nearest whole dollar.) LaidBack StressedOut Allocated costs
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