Quillen Company manufactures a product in a factory thathas two production departments, Cutting and Sewing, andtwo support departments, S1 and S2. The activity driver forS1 is number of employees, and the activity driver for S2 isnumber of maintenance hours. The following data pertainto Quillen:Direct costsNormal activity:Number ofemployeesMaintenancehoursRequired:12SupportDepartmentsS1S2Cutting$180 000 $150 000 $122 0001 200ProductionDepartments306316 000Sewing$90 5001474 000Calculate the cost assignment ratios to be used underthe direct method for Departments S1 and S2. (Note:Each support department will have two ratios - onefor Cutting and the other for Sewing.)Allocate the support department costs to theproduction departments by using the direct method.

The direct method is one of the methods of cost allocation where in the total costs of support…

Required: 1 2 Calculate the cost assignment ratios to be used under the direct method for Departments S1 and S2. (Note: Each support department will have two ratios - one for Cutting and the other for Sewing.) Allocate the support department costs to the production departments by using the direct method.

Required: 1 2 Calculate the cost assignment ratios to be used under the direct method for Departments S1 and S2. (Note: Each support department will have two ratios - one for Cutting and the other for Sewing.) Allocate the support department costs to the production departments by using the direct method.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter4: Job-order Costing And Overhead Application

Section: Chapter Questions

Problem 27BEA: Use the following information for Brief Exercises 4-27 and 4-28: Quillen Company manufactures a...

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