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Clausen Company internal records of its factory with 2 operating departments. The cost driver for indirect...

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Accounting

Clausen Company internal records of its factory with 2 operatingdepartments. The cost driver for indirect labor is direct laborhouse, and the cost driver for the remaining items is number ofhours of machine use. Compute the total amount of indirectlabor allocated to Department 1 using activity basedcosting. (Please show the formula and how you got theanswer)

DL HOURSMACHINE HOURS
Department 189412,000
Department 220868,000
Totals298020,000
Factory Overhead costs
Rent and Utilities21,200
Indirect Labor16,800
Depreciation - Equipment13,500
Total Factory Overhead$51,500

Answers:

a) 8,000

b) 53,000

c) 12,270

d) 8, 480

e) 14,133

Answer & Explanation Solved by verified expert
4.4 Ratings (623 Votes)
All working forms part of the answer Note that you have asked for Indirect labor allocated to Department 1 The correct answer is 5040 which is equal to    See Answer
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Clausen Company internal records of its factory with 2 operatingdepartments. The cost driver for indirect labor is direct laborhouse, and the cost driver for the remaining items is number ofhours of machine use. Compute the total amount of indirectlabor allocated to Department 1 using activity basedcosting. (Please show the formula and how you got theanswer)DL HOURSMACHINE HOURSDepartment 189412,000Department 220868,000Totals298020,000Factory Overhead costsRent and Utilities21,200Indirect Labor16,800Depreciation - Equipment13,500Total Factory Overhead$51,500Answers:a) 8,000b) 53,000c) 12,270d) 8, 480e) 14,133

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