Author Question: Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The ... (Read 253 times)

audragclark · **on:** Mar 6, 2021

Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis:

Budgeted manufacturing overhead costs:

Maintenance

M (Support Dept)

$400,000

Personnel

P (Support Dept)

$150,000

Weaving

W (Weaving Dept)

$620,000

Colorizing

C (Colorizing Dept)

$360,000

Services furnished:
By Maintenance (budgeted labor-hours):

to Personnel

1000

to Weaving

8000

to Colorizing

4100

By Personnel (Number of employees serviced):

Plant Maintenance

12

Weaving

36

Colorizing

23

Which of the following linear equations represents the complete reciprocated cost of the Personnel Department?
◦ P = $400,000 - $150,000 (1000 / 13,100) M
◦ P = (1000 / 13,100) M
◦ P = $150,000 + (1000 / 13,100) M
◦ P = $150,000

deja · **Reply #1 on:** Mar 6, 2021

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