Cornerstone Exercise 7.4 (Algorithmic) Sequential (Step) Method of Support Depar

Question

Cornerstone Exercise 7.4 (Algorithmic)
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.

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. 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 "0". Use the rounded values for subsequent calculations.

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 Departments Human
Resources General
Factory Fabricating Assembly Direct costs $180,000    $390,000    $114,800    $98,000    Normal activity:    Number of employees —    40    70    160       Square footage 2,000    —    5,900    13,500   

Explanation / Answer

Answer:1

Answer:2

Proportion of Driver Used by Human Resources General Factory Fabricating Assembly Human Resources 26666.66667 46666.66667 61276.59574 General Factory 36448.59813 107523.3645 246028.0374

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.