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Carolina Stoneware Company manufactures pottery in two production departments, P1 and P2. The production departments receive
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Answer #1

Correct Answer:

Requirement A:

The amount will be allocated by computing the respective percentage of total amount and then allocating it to the concerned department.

For example, the amount allocated of Department s1 will be computed by:

Amount to be allocated of department S1 = 12000

Amount allocated to Department S2 = 12000*10%

Amount allocated to Department S3 = 12000 *10%

Amount allocated to Department S4 12000 * 5%

Amount allocated to Department P1 = 12000 * 30%

Amount allocated to Department P2= 12000 * 45%

Requirement 2:

Total amount allocates to production Department 1: $ 29,849.41

Total amount allocated to production department 2: $ 32,203.82

Requirement A:

Departmental cost

Amount

S1

S2

S3

S4

P1

P2

Department S1

$ 12,000.00

$   1,200.00

$           1,200.00

$               600.00

$    3,600.00

$    5,400.00

Department S2

$ 15,000.00

$   1,500.00

$           4,500.00

$           1,500.00

$    5,250.00

$    2,250.00

Department S3

$ 10,000.00

$   2,000.00

$   2,000.00

$           1,000.00

$    3,000.00

$    2,000.00

Department S4

$ 25,000.00

$   3,750.00

$   2,500.00

$           3,750.00

$    5,000.00

$ 10,000.00

Total

$   7,250.00

$   5,700.00

$           9,450.00

$           3,100.00

$ 16,850.00

$ 19,650.00

Requirement B

Reciprocal method

Department S1

$ (7,250.00)

$       725.00

$               725.00

$               362.50

$    2,175.00

$    3,262.50

Subtotal

$                -  

$   6,425.00

$         10,175.00

$           3,462.50

$ 19,025.00

$ 22,912.50

Department S2

$       642.50

$ (6,425.00)

$           1,927.50

$               642.50

$    2,248.75

$        963.75

  Subtotal

$       642.50

$                -  

$         12,102.50

$           4,105.00

$ 21,273.75

$ 23,876.25

Department S3

$   2,420.50

$   2,420.50

$      (12,102.50)

$           1,210.25

$    3,630.75

$    2,420.50

  Subtotal

$   3,063.00

$   2,420.50

$                        -  

$           5,315.25

$ 24,904.50

$ 26,296.75

Department S4

$       797.29

$       531.53

$               797.29

$         (5,315.25)

$    1,063.05

$    2,126.10

  Subtotal

$   3,860.29

$   2,952.03

$               797.29

$                        -  

$ 25,967.55

$ 28,422.85

Department S1

$ (3,860.29)

$       386.03

$               386.03

$               193.01

$    1,158.09

$    1,737.13

  Subtotal

$                -  

$   3,338.05

$           1,183.32

$               193.01

$ 27,125.64

$ 30,159.98

Department S2

$       333.81

$ (3,338.05)

$           1,001.42

$               333.81

$    1,168.32

$        500.71

  Subtotal

$       333.81

$                -  

$           2,184.73

$               526.82

$ 28,293.96

$ 30,660.69

Department S3

$       436.95

$       436.95

$         (2,184.73)

$               218.47

$        655.42

$        436.95

  Subtotal

$       770.75

$       436.95

$                        -  

$               745.29

$ 28,949.37

$ 31,097.63

Department S4

$       111.79

$         74.53

$               111.79

$            (745.29)

$        149.06

$        298.12

  Subtotal

$       882.55

$       511.48

$               111.79

$                        -  

$ 29,098.43

$ 31,395.75

Department S1

$     (882.55)

$         88.25

$                 88.25

$                 44.13

$        264.76

$        397.15

  Subtotal

$                -  

$       599.73

$               200.05

$                 44.13

$ 29,363.20

$ 31,792.90

Department S2

$         59.97

$     (599.73)

$               179.92

$                 59.97

$        209.91

$          89.96

  Subtotal

$         59.97

$                -  

$               379.97

$               104.10

$ 29,573.10

$ 31,882.86

Department S3

$         75.99

$         75.99

$            (379.97)

$                 38.00

$        113.99

$          75.99

  Subtotal

$       135.97

$         75.99

$                        -  

$               142.10

$ 29,687.09

$ 31,958.85

Department S4

$         21.31

$         14.21

$                 21.31

$            (142.10)

$          28.42

$          56.84

  Subtotal

$       157.28

$         90.20

$                 21.31

$                        -  

$ 29,715.51

$ 32,015.69

Department S1

$     (157.28)

$         15.73

$                 15.73

$                   7.86

$          47.18

$          70.78

  Subtotal

$                -  

$       105.93

$                 37.04

$                   7.86

$ 29,762.70

$ 32,086.47

Department S2

$         10.59

$     (105.93)

$                 31.78

$                 10.59

$          37.08

$          15.89

  Subtotal

$         10.59

$                -  

$                 68.82

$                 18.46

$ 29,799.77

$ 32,102.35

Department S3

$         13.76

$         13.76

$              (68.82)

$                   6.88

$          20.65

$          13.76

  Subtotal

$         24.36

$         13.76

$                        -  

$                 25.34

$ 29,820.42

$ 32,116.12

Department S4

$            3.80

$            2.53

$                   3.80

$               (25.34)

$             5.07

$          10.14

  Subtotal

$         28.16

$         16.30

$                   3.80

$                        -  

$ 29,825.49

$ 32,126.26

Department S1

$       (28.16)

$            2.82

$                   2.82

$                   1.41

$             8.45

$          12.67

  Subtotal

$                -  

$         19.11

$                   6.62

$                   1.41

$ 29,833.93

$ 32,138.93

Department S2

$            1.91

$       (19.11)

$                   5.73

$                   1.91

$             6.69

$             6.69

  Subtotal

$            1.91

$                -  

$                 12.35

$                   3.32

$ 29,840.62

$ 32,145.62

Department S3

$            2.47

$            2.47

$               (12.35)

$                   1.24

$             4.32

$             1.85

  Subtotal

$            4.38

$            2.47

$                        -  

$                   4.55

$ 29,844.95

$ 32,147.47

Department S4

$            0.68

$            0.46

$                   0.68

$                 (4.55)

$             0.91

$             1.82

  Subtotal

$            5.06

$            2.93

$                   0.68

$                        -  

$ 29,845.86

$ 32,149.29

Department S1

$         (5.06)

$            0.51

$                   0.51

$                   0.25

$             1.52

$             2.28

  Subtotal

$                -  

$            3.43

$                   1.19

$                   0.25

$ 29,847.38

$ 32,151.57

Department S2

$            0.34

$         (3.43)

$                   1.03

$                   0.34

$             1.20

$          51.48

  Subtotal

$            0.34

$                -  

$                   2.22

$                   0.60

$ 29,848.58

$ 32,203.05

Department S3

$            0.44

$            0.44

$                 (2.22)

$                   0.22

$             0.67

$             0.44

  Subtotal

$            0.79

$            0.44

$                        -  

$                   0.82

$ 29,849.24

$ 32,203.50

Department S4

$            0.12

$            0.08

$                   0.12

$                 (0.82)

$             0.16

$             0.33

  Total

$            0.91

$            0.53

$                   0.12

$                        -  

$ 29,849.41

$ 32,203.82
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