MIS CH17 HW1

MIS CH17 HW1

1.

value: 9.09 points

 

 

Hudson Community College enrolls students in two departments, Liberal Arts and Sciences. The college also has two service departments, the Library and the Computing Services Department. The usage of these two service departments’ output for the year is as follows:

 

 

	Provider of Service
User of Service	Library	Computing Services
Library		—			20	%
Computing Services		—			—
Liberal Arts		60	%		30	%
Sciences		40	%		50	%

 

 

The budgeted costs in the two service departments for the year are as follows:

 

 

Library	$	710,000
Computing Services		240,000

 

 

Required:

 

 

1.	Use the direct method to allocate the budgeted costs of the Library and Computing Services Department to the college’s Liberal Arts and Sciences departments. (Do not round intermediate calculations and round your final answers to the nearest dollar amount. Omit the “$” sign in your response.)

 

 

Provider of Service	Liberal Arts	Sciences
Library	$	$
Computing
Total	$	$

 

eBook Link references

 

 

2.

value: 9.09 points

 

 

Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows:

 

 

	Provider of Service
User of Service	HR	Computing
HR		—			15	%
Computing		20	%		—
Deposit		50	%		50	%
Loan		30	%		35	%

 

 

The budgeted costs in the two service departments for the year are as follows:

 

 

HR	$	162,000
Computing		239,700

 

 

Required:

 

 

Use the direct method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. (Do not round intermediate calculations and round your final answers to the nearest dollar amount. Omit the “$” sign in your response.)

 

 

Provider of Service	Deposit	Loan
HR	$	$
Computing
Total	$	$

 

eBook Link references

 

 

 

3.

value: 9.09 points

 

 

Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows:

 

 

Joint Cost	Cereal	Quantity at Split-Off Point	Sales Price per Kilogram
$	46,000		Yummies		28,800	kilograms	$	4.90
			Crummies		7,200	kilograms		5.40

 

Required:

Use the physical-units method to allocate the company’s joint production cost between Yummies and Crummies. (Do not round intermediate calculations. Omit the “$” sign in your response.)

 

	Allocation of Joint Cost
Yummies	$
Crummies	$

eBook Link references

4.

value: 9.09 points

 

 

Hudson Community College enrolls students in two departments, Liberal Arts and Sciences. The college also has two service departments, the Library and the Computing Services Department. The usage of these two service departments’ output for the year is as follows:

 

 

	Provider of Service
User of Service	Library	Computing Services
Library		—			20	%
Computing Services		—			—
Liberal Arts		60	%		30	%
Sciences		40	%		50	%

 

The budgeted costs in the two service departments for the year are as follows:

 

Library	$	600,000
Computing Services		240,000

 

Required:

 

1.	Use the step-down method to allocate Hudson Community College’s service department costs to the Liberal Arts and Sciences departments. (Do not round intermediate calculations and round your final answers to the nearest dollar amount. Omit the “$” sign in your response.)

 

 

	Liberal Arts	Sciences
Allocation of Computing Service costs	$	$
Allocation of Library costs
Total costs allocated to each department	$	$

eBook Link references

 

 

 

5.

value: 9.09 points

 

 

Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows:

 

 

	Provider of Service
User of Service	HR	Computing
HR		—			15	%
Computing		10	%		—
Deposit		60	%		50	%
Loan		30	%		35	%

 

 

The budgeted costs in the two service departments for the year are as follows:

 

 

HR	$	153,000
Computing		229,500

 

 

Required:

 

 

Use the step-down method to allocate the budgeted costs of the HR and Computing departments to the Deposit and Loan departments. Tuscaloosa National Bank allocates the costs of the HR Department first. (Do not round intermediate calculations and round your final answers to the nearest dollar amount. Omit the “$” sign in your response.)

 

 

	Deposit	Loan
Allocation of HR Department costs	$	$
Allocation of Computing Department costs
Total costs allocated to each department	$	$

 

eBook Link references

6.

value: 9.09 points

 

 

Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows:

 

 

Joint Cost	Cereal	Quantity at Split-Off Point	Sales Price per Kilogram
$	30,000		Yummies		12,000	kilograms	$	2.00
			Crummies		8,000	kilograms		2.50

 

Required:

Use the relative-sales-value method to allocate Breakfasttime Cereal Company’s joint production cost between Yummies and Crummies. (Round your calculation of relative proportions to 3 decimal places. Omit the “$” sign in your response.)

 

	Sales Value at Split-off Point	Allocation of Joint Cost
Yummies	$	$
Crummies
Total	$	$

eBook Link references

 

 

 

[The following information applies to the questions displayed below.]

Breakfasttime Cereal Company manufactures two breakfast cereals in a joint process. Cost and quantity information is as follows:

 

Joint Cost	Cereal	Quantity at Split-Off Point	Sales Price per Kilogram
$	30,000		Yummies		12,000	kilograms	$	2.00
			Crummies		8,000	kilograms		2.50

 

Breakfasttime Cereal Company has an opportunity to process its Crummies further into a mulch for ornamental shrubs. The additional processing operation costs $.50 per kilogram, and the mulch will sell for $3.50 per kilogram.

 

 

7.

value: 9.09 points

 

 

 

Required:

 

 

1-a.	Compute the incremental revenue per kilogram if management decide to process Crummies into the mulch. (Round your answer to 2 decimal places. Omit the “$” sign in your response.)

 

 

Net incremental revenue

$ per kilogram

 

 

1-b.	Should Breakfasttime’s management decide to process Crummies into the mulch?
	No   Yes

 

eBook Link references

Worksheet

Difficulty: Medium

Learning Objective: 17-04 Allocate joint costs among joint products using each of the following techniques: physical-units method, relative-sales-value method, and net-realizable-value method.

 

 

 

8.

value: 9.09 points

 

 

 

2.	Suppose the company does process Crummies into the mulch. Use the net-realizable-value method to allocate the joint production cost between the mulch and the Yummies. (Do not round intermediate calculations. Omit the “$” sign in your response.)

 

 

	Allocation of Joint Cost
Yummies	$
Mulch	$

 

eBook Link references

Worksheet

Difficulty: Medium

Learning Objective: 17-04 Allocate joint costs among joint products using each of the following techniques: physical-units method, relative-sales-value method, and net-realizable-value method.

[The following information applies to the questions displayed below.]

Snake River Sawmill manufactures two lumber products from a joint milling process. The two products developed are mine support braces (MSB) and unseasoned commercial building lumber (CBL). A standard production run incurs joint costs of $300,000 and results in 60,000 units of MSB and 90,000 units of CBL. Each MSB sells for $2, and each unit of CBL sells for $4.

 

 

 

 

 

 

 

 

9.

value: 9.09 points

 

 

 

2.	Calculate the amount of joint cost allocated to the mine support braces (MSB) on a relative-sales-value basis. (Do not round your intermediate calculations. Omit the “$” sign in your response.)

 

 

Joint cost allocated to MSB

$

 

eBook Links (2) references

Worksheet	Learning Objective: 17-04 Allocate joint costs among joint products using each of the following techniques: physical-units method, relative-sales-value method, and net-realizable-value method.
Difficulty: Medium	Learning Objective: 17-05 Describe the purposes for which joint cost allocation is useful and those for which it is not.

 

 

10.

value: 9.09 points

 

 

 

3.

Assume the commercial building lumber is not marketable at split-off but must be further planed and sized at a cost of $200,000 per production run. During this process, 10,000 units are unavoidably lost; these spoiled units have no value. The remaining units of commercial building lumber are saleable at $10 per unit. The mine support braces, although saleable immediately at the split-off point, are coated with a tarlike preservative that costs $100,000 per production run. The braces are then sold for $5 each. Using the net-realizable-value basis, compute the completed cost assigned to each unit of commercial building lumber. (Do not round your intermediate calculations. Round your answer to 2 decimal places.Omit the “$” sign in your response.)

 

 

Cost per unit of CBL

$

 

eBook Links (2) references

Worksheet	Learning Objective: 17-04 Allocate joint costs among joint products using each of the following techniques: physical-units method, relative-sales-value method, and net-realizable-value method.
Difficulty: Medium	Learning Objective: 17-05 Describe the purposes for which joint cost allocation is useful and those for which it is not.

 

 

11.

value: 9.10 points

 

 

 

Required:
1.	Calculate the amount of joint cost allocated to commercial building lumber (CBL) on a physical units basis. (Do not round your intermediate calculations. Omit the “$” sign in your response.)

 

 

Joint cost allocated to CBL

$

 

eBook Links (2) references

 

 

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