Question:
The RAH Manufacturing Company has two service departments: Maintenance and Accounting. The Maintenance Department's costs of $300,000 are allocated on the basis of machine hours. The Accounting Department's costs of $120,000 are allocated on the basis of the number of employees within a specific department. The direct departmental costs for A and B are $300,000 and $500,000, respectively.
Maint Acctg A B
machine hours 480 20 2300 200
number of employees 2 2 8 4
1. What is the cost of the Accounting Department's cost allocated to Department A using the step method and assuming the Maintenance Department's costs are allocated first?
A. $81,333
B. $81,587
C. $80,000
D. $68,571
please show the calculations for this problem
1. Last year, Twins Company reported $750,000 in sales (25,000 units) and a net operating income of $25,000. At the break-even point, the company's total contribution margin equals $500,000. Based on this information, the company's:
A. contribution margin ratio is 40%.
B. break-even point is 24,000 units.
C. variable expense per unit is $9.
D. variable expenses are 60% of sales.