Check my work 3 Problem 11B-5 Service Department Charges [L011-6) Tasman Product
ID: 2437730 • Letter: C
Question
Check my work 3 Problem 11B-5 Service Department Charges [L011-6) Tasman Products, Ltd., of Australia has a Maintenance Department that services the equipment in the company's Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine-hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below 10 points Data for the Maintenance Department follow: eBook Budget 277,400 $354, 620 $197,000 $211,700 Actual Variable costs for lubricants Fixed costs for salaries and other Print Budgeted at $19 per machine-hour. References Data for the Forming and Assembly Departments follow Percentage of Peak-Period Machine-Boura Capacity Required Budget Actual Forming Department Assenbly Department Total 9,50011,500 338 100 ,1004,100 14,600 15,600 The level of fixed costs in the Maintenance Department is determined by peak-period requirements Required: Management would like data to assist in comparing actual performance to planned performance in the Maintenance Department and in the other departments 1. How much Maintenance Department cost should be charged to the Forming Department and to the Assembly Department? 2. How much, if any, of the actual Maintenance Department costs for the year should be treated as a spending variance and not charged to the Forming and Assembly departments? Complete this question by entering your answers in the tabs below Prev 3 of 3 EE NextExplanation / Answer
Maintenance Department Service Budget Actual Variable 277400 354620 Fixed 197000 211700 Total 474400 566320 Budget $19 per hour 19 Req1 Forming Department Assembly Department Varible cost 180500 =9500*19 96900 =5100*19 Fixed cost 131990 =197000*67% 65010 =197000*33% Total cost charged 312490 161910 Req2 Spending Variance 91920 =566320-474400