Reference no: EM132755694

Questions -

Q1. Ransom Widgets allocates the estimated cost of its accounting department, $200,000, to its production and sales departments since the accounting department supports these departments with regard to payroll and accounts payable functions. The accounting department costs will be allocated based on the number of employees using the direct method. Information regarding employees follows:

Department Employees

Accounting 4

Production 36

Sales 12

How much of the accounting department costs will be allocated to the production and sales departments, respectively?

Q2. Intermodal Moving uses the direct method and allocates its maintenance costs on the basis of repair hours and its payroll department costs on the basis of employees. Estimated costs and information on the services and production departments follows:

Payroll $36,000

Maintenance $48,000

Packing 30 employees, 28 repair hours

Driving 10 employees, 1,960 repair hours

How much of the payroll and maintenance costs will be allocated to the packing department?