7.

3
Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Normal activity:
No.of Employees 60
Square footage 1000

a) Allocation ratio:
Proportion of Driver used by

Particulars Human Resources General Factory

No.of Employees
Square footage

b) Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Allocated costs ($):
No.of Employees -160000
Square footage -340000
Total after allocation 0 0

c) Since none of the Human Resources cost is allocated to General Factory, it does not matter how many em
 COST MANAGEMENT
FI304C NAME: V R MANASA MAHALAKSHMI
ASSIGNMENT IV ROLLNO: AM.BU.P2MBA21063

Producing Departments

Fabricating Assembly
114600 93000

80 170
5700 13300

Fabricating Assembly
0.32 0.68
0.3 0.7

Producing Departments

Fabricating Assembly
114600 93000

51200 108800
102000 238000
267800 439800

actory, it does not matter how many employees are used by General Factory.
 7.4 Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Normal activity:
No.of Employees 60
Square footage 1000

a) Support Departments Producing Departments

Particulars Human Resources General Factory

No.of Employees 0.1935
Square footage

b) Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Allocated costs ($):
No.of Employees -160000 30960
Square footage 370960
-370960
Total after allocation 0 0

c) Support Departments Producing Departments

Particulars Human Resources General Factory

No.of Employees 0.193548
Square footage

Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Allocated costs ($):
No.of Employees -160000 30967.7419354839
Square footage 370967.741935484
-370967.741935484
Total after allocation 0 0
Producing Departments

Fabricating Assembly
114600 93000

80 170
5700 13300

Producing Departments

Fabricating Assembly
0.2581 0.5484
0.3 0.7

Producing Departments

Fabricating Assembly
114600 93000

41296 87744

111288 259672
267184 440416

Producing Departments

Fabricating Assembly
0.258065 0.548387
0.3 0.7

Producing Departments

Fabricating Assembly
114600 93000

41290.3225806452 87741.93548387
111290.322580645 259677.4193548

267181 440419
 7.5 Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Normal activity:
No.of Employees 60
Square footage 1000

a) Support Departments Producing Departments

Particulars Human Resources General Factory

No.of Employees 0.1935
Square footage 0.05

b) Simultaneous Equation

Human Resources = 160000 + 0.05G

General Factory = 340000 + 0.1935H

Solving for Human resources:

Human Resources = 160000+0.05(340000+0.1935H)

Human Resources = 160000+17000+0.009675H
H-0.009675H = 177000
0.990325H = 177000
H = 177000/0.9903325
H = 178728.

Therefore, G = 340000 + 0.1935*178728

G = 374584.

H = $178728
G = $374584

c) Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Allocated costs ($):
No.of Employees -178728 34593
Square footage 18729 -374584
Total after allocation 1.20000000000073 9
d) Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Normal activity:
No.of Employees 60
Square footage 1000

Support Departments Producing Departments

Particulars Human Resources General Factory

No.of Employees 0.1935
Square footage 0.05

Support Departments Producing Departments

Particulars Human Resources General Factory

Direct costs ($) 160000 340000
Allocated costs ($):
No.of Employees -178728 34593
Square footage 18729.2 -374584
Total after allocation 1.20000000000073 9
Producing Departments

Fabricating Assembly
114600 93000

80 170
5700 13300

Producing Departments

Fabricating Assembly
0.2581 0.5484
0.285 0.665

Producing Departments

Fabricating Assembly
114600 93000

46123 98012
106756 249098
267480 440110
Producing Departments

Fabricating Assembly
114600 93000

80 170
13300 5700

Producing Departments

Fabricating Assembly
0.2581 0.5484
0.665 0.285

Producing Departments

Fabricating Assembly
114600 93000 The total cost for fabricatimg has increased, while that of asse
decreased following the changes.
46123 98012
249098 106756
409822 297769
as increased, while that of assembly has