Exam 22: Performance Measurement and Responsibility Accounting

Regal Furniture Company allocates its indirect salaries of $22,500 on the basis of sales.Determine the indirect salaries allocated to Departments 1 and 2 using the following information.

City Park College allocates administrative costs to its teaching departments based on the number of students enrolled,while maintenance and utilities are allocated based on square feet of classrooms.Based on the information below,what is the total amount of expenses allocated to each department (rounded to the nearest dollar)if administrative costs for the college were $180,000,maintenance expenses were $70,000,and utilities were $85,000?

Direct expenses are costs readily traced to a department because they are incurred for that department's sole benefit.

Departmental contribution to overhead is calculated as the amount of sales of the department less:

Rent and maintenance expenses would most likely be allocated based on:

A department can never be considered to be a profit center.

Part AR3 costs the Southwestern Division of Luxon Corporation $26 to make-direct materials are $10,direct labor is $4,variable manufacturing overhead is $9,and fixed manufacturing overhead is $3.Southwestern Division sells Part AR3 to other companies for $30.The Northeastern Division of Luxon Corporation can use Part AR3 in one of its products.The Southwestern Division has enough idle capacity to produce all of the units of Part AR3 that the Northeastern Division would require.What is the lowest transfer price at which the Southwestern Division should be willing to sell Part AR3 to the Northeastern Division?

A report that accumulates the actual expenses that a manager is responsible for and their budgeted amounts is a:

Ready Company has two operating (production)departments: Assembly and Painting.Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and occupies 36,000 square feet.Indirect factory expenses for the current period are as follows: Administration is allocated based on workers in each department; maintenance is allocated based on square footage. -The amount of maintenance expenses that should be allocated to the Painting Department for the current period is:

Expenses that are easily traced and assigned to a specific department because they are incurred for the sole benefit of that department are called:

In the two-stage cost allocation,________ costs are allocated to operating departments,and the operating department costs are allocated to ________.

Which of the following is not a step in creating operating department income statements?

A responsibility accounting performance report displays:

The following is a partially completed departmental expense allocation spreadsheet for Brickland.It reports the total amounts of direct and indirect expenses for its four departments.Purchasing department expenses are allocated to the operating departments on the basis of purchase orders.Maintenance department expenses are allocated based on square footage.Compute the amount of Maintenance department expense to be allocated to Fabrication.

A joint cost of producing two products can be allocated between those products on the basis of the relative physical quantities of each product produced.

A granary allocates the cost of unprocessed wheat to the production of feed,flour,and starch.For the current period,unprocessed wheat was purchased for $120,000,and the following quantities of product and sales revenues were produced. How much of the $120,000 cost should be allocated to feed if the value basis is used?

Departmental salary expenses are direct expenses of that department.

A unit of a business that generates revenues and incurs costs is called a:

What is the main difference between a cost center and a profit center?

Brownley Company has two service departments and two operating (production)departments.The Payroll Department services all three of the other departments in proportion to the number of employees in each.The Maintenance Department costs are allocated to the two operating departments in proportion to the floor space used by each.Listed below are the operating data for the current period: -The total cost of operating the Milling Department for the current period is: