| Exercise E6 6 Cost Allocation Process | ||||||||
| Apex Company’s Copy Department, which does all of the photocopying for the Sales Department and the Administration Department, budgets | ||||||||
| the following costs for the year, based on the expected activity of | 5,000,000 | copies. | ||||||
| Salaries (Fixed) | $80,000 | |||||||
| Employee benefits (Fixed) | 10,000 | |||||||
| Depreciation of copy machines (Fixed) | 10,000 | |||||||
| Utilities (Fixed) | 5,000 | |||||||
| Paper (Variable) Per copy: | $0.01 | 50,000 | ||||||
| Toner (Variable) Per copy: | $0.01 | 50,000 | ||||||
| The costs are assigned to two pools, one for fixed and one for variable costs. The costs are then assigned to the Sales Department and the | ||||||||
| Administrative Department. Fixed costs are assigned on a lump sum basis, | 40% | to Sales and | 60% | to | ||||
| Administration. The variable costs are assigned at a rate of | $0.02 | per copy. | ||||||
| Required: | ||||||||
| Assuming | 4,800,000 | copies were made during the year, | 2,500,000 | for Sales and | 2,300,000 | for Administration, calculate | ||
| the Copy Department costs allocated to Sales and Administration. | ||||||||
| Total costs to be allocated: | ||||||||
| Title | Amount | |||||||
| Title | Amount | |||||||
| Title | Amount | |||||||
| Title | Amount | |||||||
| Total: | Formula | |||||||
| Costs allocated to Sales: | ||||||||
| Title | Formula | |||||||
| Title | Formula | |||||||
| Title | Formula | |||||||
| Costs allocated to Admin: | ||||||||
| Title | Formula | |||||||
| Title | Formula | |||||||
| Title | Formula | |||||||
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.