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Answer the following questions using the information below: Jake's Battery Company has two service departments, Maintenance and Personnel. Maintenance Department costs of $320,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $80,000 are allocated based on the number of employees. The costs of operating departments A and.
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21) What is the Capping Department's total cost if both service departments are allocated using the complete reciprocated cost method and their costs for the year were $375,000 for Plant Maintenance and $100,000 for Data Processing? A) $412,766 B) $321,898 C) $196,898 D) $191,053 E) $184,132 22) Which method allows for partial recognition of the services.
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11) Which of the following is NOT a strategy for costing inventory when joint-cost circumstances are involved? A) Allocate costs according to the market selling price. B) Allocate costs based on constant gross margin. C) Allocate costs according to a predetermined physical measure. D) Use the estimated net realizable value. E) Allocate costs according to.
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37) Seacrest Corp. allocates support department overhead costs to operating departments X and Y by means of the reciprocal allocation method. Information for the current month is as follows: Support Departments A B Overhead Costs$20,000$10,000 Services provided from departments above: A-10% B20% - X40%30% Y40%60% 100%100% Required: Provide the linear equation that represents the complete reciprocated cost of Support Department A. 38).
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40) AllCanada Wire Products processes copper into wire. It makes 12 gauge and 14 gauge wire. During April the joint costs of processing the aluminium were $365,000. There were no beginning or ending inventories for the month. Production and sales value information for the month were as follows: Product      Feet        Separable Costs      Selling Price 14.
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39) The Eco-Garden Corporation operates one central plant that has two divisions, the Lawnmower Division and the Weedwacker Division. The following data apply to the coming budget year: Budgeted costs of the operating the plant for 4,000 to 8,000 hours: Fixed operating costs per year$280,000 Variable operating costs$15per hour Practical capacity7,000hours per year Budgeted long-run usage.
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20) Correl Company's power plant provides electricity for its two operating departments, A and B. The year 2015 budget for the power plant shows: Budgeted fixed costs$80,000 Budgeted variable costs per kilowatt hour (kwh)$0.15 Additional data for 2015: BudgetActual (kwh)(kwh) Department A240,000215,000 Department B160,000195,000 Actual power plant costs: fixed $92,000, variable $88,000 Budgeted rates are used in the allocation of.
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14.2   Evaluate and select between a single- and dual-rate cost methods to apply period costs of support departments. 1) The single-rate method is when all indirect costs are combined in one cost pool and allocated to cost objects via a single rate per unit. 2) One of the important aspects about the.
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Answer the following questions using the information below: The Charmatz Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year: Budgeted costs of operating the copying facility for 400,000 to 600,000 copies: Fixed costs per.
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40) Using the sales value at splitoff method, the joint costs allocated to Jarlon would be A) $289,520. B) $115,808. C) $405,328. D) $110,480. E) $154,672. 41) Using the sales value at splitoff method, the joint costs allocated to Kharton would be A) $289,520. B) $115,808. C) $110,480. D) $154,672. E) $405,328. 42) Using the physical measures method, the joint costs allocated.
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22) The cost of operating the quality control department of Ames Manufacturing includes $608,000 of fixed costs and $400,000 of variable costs. The department normally budgets 21,000 inspection hours a year. Two departments receive quality control checks, fabrication and assembly. Fabrication is budgeted at 12,000 hours a year, while assembly.
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  15.1   Distinguish among different types of saleable products, scrap and toxic waste. 1) Joint costs are incurred beyond the splitoff point and are assignable to individual products. 2) A byproduct has a minimal sales value. 3) Scrap frequently has a zero sales value. 4) There are no logical reasons for allocating joint costs. 5) Separable.
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38) Purple Paper Company processes wood pulp into two products. During July the joint costs of processing were $50,000. Production and sales value information for the month were as follows: Sales Value at Product    Kilograms Produced   splitoff Point   Separable Costs Paper125,000$63,000$221,000 Cardboard96,00046,000262,000 Paper sells for $2.71 a kilogram and cardboard sells for $3.10 a kilogram. There were no.
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36) Red Paper Company processes wood pulp into two products. During March the joint costs of processing were $144,000. Production and sales value information for the month were as follows: Sales Value at Product    Kilograms Produced   splitoff Point    Separable Costs Paper130,000$80,000$224,000 Cardboard108,000 70,000 264,000 Paper sells for $2.75 a kilogram and cardboard sells for $3.50 a kilogram. There.
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Answer the following question(s) using the information below: The Bonawitz Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year: Budgeted costs of operating the copying facility for 200,000 to 300,000 copies:          Fixed.
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For each item listed, select the appropriate purpose of cost allocation from the list below. A purpose may be used more than once. A) To provide information for economic decisions B) To motivate managers and other employees C) To justify costs or compute reimbursement amounts D) To measure income and assets for reports to.
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41) Campaign Printing has two service departments, S1 and S2, and two production departments, P1 and P2. The data for April were as follows: Dept.     Provided to:             From:       Costs     S1     S2    P1    P2 S1$90,00010%40% 50% S260,00020%55% 25% P1360,000 P2520,000 Required: a.Set up algebraic equations in linear equation form for the service and production departments. b.Using the reciprocal method determine the reciprocated.
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For each of the following cost pools select an appropriate allocation base from the list below if the overall cost object is to assign costs to production departments. Each base can be used only once. Assume a manufacturing company. A) Number of employees per department. B) Machine hours by department. C) Hours of.
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51) Sweet Sugar Company processes sugar beets into three products. During April the joint costs of processing were $240,000. Production and sales value information for the month were as follows: Sales Value at UnitsSplitoff Separable Product         Produced   Sales Value    Costs   Sugar12,000$80,000$24,000 Sugar syrup8,000$70,000$64,000 Fructose syrup4,000$50,000$32,000 Required: Determine the amount of joint cost allocated to each product if the sales value.
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14.4   Evaluate and select among the direct, step-down, and reciprocal methods of allocating support division costs to production divisions. 1) The direct allocation method ignores any services rendered between support departments. 2) The step-down allocation method allows partial recognition of services rendered by support departments to other support departments. 3) The reciprocal allocation.
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21) Assigning joint costs when only a portion of a business's products are sold to a single customer is an example of which of the following? A) inventory costing for external financial statements B) customer profitability analysis C) rate regulation requirements D) price regulation E) cost reimbursement 22) A business which enters into a contract to.
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24) Blaster Drive-In is a fast-food restaurant that sells burgers and hot dogs in a 1950s environment. The fixed operating costs of the company are $5,000 per month. The controlling shareholder, interested in product profitability and pricing, wants all costs allocated to either the burgers or the hot dogs. The.
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Use the information below to answer the following question(s): Orange Paper Company processes wood pulp into two products. During February the joint costs of processing were $156,000. Production and sales value information for the month were as follows: Sales Value at Product    Kilograms Produced   splitoff Point   Separable Costs Paper180,000$30,000$232,000 Cardboard132,00020,000277,000 Paper sells for $2.85 a kilogram and cardboard.
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37) The fixed costs of operating the maintenance facility of General Hospital are $4,500,000 annually. Variable costs are incurred at the rate of $30 per maintenance-hour. The facility averages 40,000 maintenance-hours a year. Budgeted and actual hours per user for the year are as follows: Budgeted hoursActual hours Building and grounds10,00012,000 Operating.
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45) Landmark Systems Inc. designs and manufactures global positioning navigation systems for all-terrain vehicles and water craft. It has two support departments: Design and Engineering; and, two production departments, Vehicle Systems and Water Craft Systems. The budgeted level of service relationships at the start of the year was: Used by: Design Engineering Vehicles Water Craft Supplied by:  .
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11) How much of the cost of the Personnel Department is allocated to Department A using the direct method? A) $5,000 B) $15,000 C) $4,211 D) $12,632 E) $40,000 12) What is the cost of the Maintenance Department allocated to Department B using the step-down method if the support department with the highest percentage of interdepartmental.
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11) Benefits of the single-rate method include A) the low cost of implementation. B) fixed costs that are transformed into variable costs for user decision making. C) signals regarding how variable and fixed costs behave differently. D) information that leads to outsourcing decisions that benefit the organization as a whole. E).
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14.5   Analyze cost allocation procedures to apply common costs and justify contractual reimbursement terms. 1) The incremental common cost allocation method requires that one user be viewed as primary and other users as incremental. 2) Allowable cost is the cost that the parties to a contract agree to exclude from reimbursed costs. 3).
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31) Cost of moulding plastic for use in making different toys on an assembly line. Diff: 1    Type: MA Skill:  Understand Objective:  LO 15-1 32) Cost of processing water into different sized bottles for human consumption. Diff: 1    Type: MA Skill:  Understand Objective:  LO 15-1 33) Cost of processing pulp into paper. Diff: 1    Type: MA Skill:  Understand Objective:  LO 15-1 Answers:.
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23) Scarborough Sales, a real estate company specializing in apartment rentals and home sales, is having difficulty in gathering appropriate cost information for evaluating its operations. It owns several large apartment complexes and sells homes owned by builders or existing homeowners. As the company's new accountant you define cost by.
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15.3   Evaluate two different market-cost methods to identify which is most appropriate. 1) The method of allocating joint product costs is an important guide for other management decisions. 2) The estimated net realizable value method allocates joint costs on the basis of the expected final sales value in the ordinary course of.
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54) Peachland Fruit Ltd. harvests blueberries. After harvest, the company sells some berries fresh, freezes others, and processes some into juice. During the summer the joint costs of processing the berry products were $620,000. Any separable costs for each product are negligible and are not traced. There were no beginning.
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30) Advantages of the sales value at splitoff method include all of the following EXCEPT A) it does not presuppose an exact number of subsequent steps for further processing. B) it uses a meaningful denominator. C) there is no anticipation of subsequent management decisions. D) it is simple. E) the allocation of joint costs could.
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15.2   Analyze the physical measure and sales value at splitoff methods to allocate joint costs. 1) The cause-and-effect criterion is not present when joint costing is used. 2) It is easier to cost inventory if the joint products are sold before the splitoff point without further processing. 3) The sales value at.
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  14.1   Apply relevance as a criterion to decide how to allocate non-manufacturing (period) costs. 1) The allocation of one particular cost must satisfy all four justifications of cost allocation. 2) Indirect costs typically constitute a large percentage of the costs assigned to cost objects. 3) Full product costing requires the recovery of all.
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43) Calamata Corporation processes a single material into three separate products A, B, and C. During September, the joint costs of processing were $300,000. Production and sales value information for the month were as follows: Product Units Produced Final Sales Value per Unit Separable Costs              A 10,000 $25 $125,000              B 15,000 30   250,000              C 12,500 24   125,000 Required: Determine the.
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11) All products yielded from joint product processing have some positive value to the firm. 12) What type of cost is the result of an event that results in multiple products simultaneously? A) byproduct cost B) joint cost C) main cost D) separable cost E) splitoff cost 13) Costs which are assignable beyond the splitoff point.
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11) To encourage the design of products that are simpler to manufacture or less costly to service, would be an example of which cost allocation purpose? A) to provide information for economic decisions B) to motivate managers and employees C) to determine employees' wages D) to measure income and assets for reporting to external.
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20) What is the approximate portion of the joint costs that should be allocated to products X and Y, respectively, using a physical volume measure? A) $461,858 and $513,142 B) $487,500 and $487,500 C) $513,142 and $461,858 D) $529,285 and $445,715 E) $530,000 and $470,000 21) What is Product X's approximate production cost per unit using.
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19) Hunt Company and Indio Company are noncompeting lines of business and use a common database for marketing purposes. The variable costs associated with accessing the database are readily identifiable and kept in separate cost pools that are charged to each user. The fixed costs of maintaining the database, however,.
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11) Smith Company and Jones Company currently share an employee dining facility. Jones Company employs fewer people and believes that they should not be required to pay one-half of the $300,000 costs incurred for the facility. An independent consulting firm stipulated that Smith Company could receive the same services for.
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15.4   Understand the irrelevance of joint costs in the sell or process further decision. 1) The amount of the joint costs is an important factor when considering to sell a product at the splitoff point or process it further. 2) All separable costs in joint cost allocations are always incremental costs. 3) When.
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Answer the following question(s) using the information below: The Morton Company processes unprocessed goat milk up to the splitoff point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October: Direct Materials processed: 65,000 litres (shrinkage was 10%) Production: condensed goat milk 26,100 litres skim.
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Use the information below to answer the following question(s). Raynor Manufacturing purchases trees from Tree Nursery and processes them up to the splitoff point, where two products (paper and pencil casings) are obtained. The products are then sold to an independent company that markets and distributes them to retail outlets. The.
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