Answer Happy

Assignment
Question(s):

(Marks 10)
Q1. State the reasons for allocating support department
costs to the operating department. What are its various methods?
Provide numerical examples of any two methods and discuss how these
methods could be used to allocate these
costs?
(CH
8, 2.5 Marks)
Answer:
Q2. Z&C has two support departments, A1 and A2, and
two operating departments, B1 and B2. Z&C has decided to use
the direct method and allocate variable A1 dept. costs based on the
number of transactions and fixed A1 dept. costs based on the number
of employees. A2 dept. variable costs will be allocated based on
the number of service requests and fixed costs will be allocated
based on the number of computers. The following information is
provided:
(CH
8, 2.5 Marks)
Support Departments
Operating Departments
A1
A2
B1
B2
Total Department variable costs
5,000
6,000
38,000
21,000
Total department fixed costs
5,800
11,000
42,000
18,000
Number of transactions
15
18
80
45
Number of employees
5
7
15
12
Number of service requests
12
7
15
10
Number of computers
6
8
10
12
Allocate variable and fixed
costs.
Answer: