Advanced Computer Solutions, Inc. has two main services: (1) time on a timeshared computer system and (2) proprietary computer programs. The operation department (Op) provides computer time and the programming department (P) writes programs.
The percentage of each service used by each department for a
typical period is:
| Supplied | ||||
| User | Op | P | ||
| Op | --- | 35 | % | |
| P | 25 | % | --- | |
| Sold to customers | 75 | % | 65 | % |
In a typical period, the operation department (Op) spends $6,400
and the programming department (P) spends $4,400.
Under the step method (Op first), what is the cost of the computer
time and the computer programs for sale?
| Time | Programs | |||||
| A. | $ | 6,400 | $ | 4,400 | ||
| B. | $ | 4,800 | $ | 6,000 | ||
| C. | $ | 1,600 | $ | 9,200 | ||
| D. | $ | 4,160 | $ | 6,640 | ||
| Department | Sale to Customers | ||
| Operation | Programming | ||
| Costs before inter-department cost allocations $ | 6400 | 4400 | 0 |
| Allocation of Op department costs (30:70) | -6400 | 1600 | 4800 |
| 0 | 6000 | ||
| Allocation of P department costs | 0 | -6000 | 6000 |
Cost of computer time for sale: $4800
Cost of computer programs for sale: $6000
Option B
Advanced Computer Solutions, Inc. has two main services: (1) time on a timeshared computer system and...
Advanced Computer Solutions, Inc. has two main services: (1) time on a timeshared computer system, and (2) proprietary computer programs. Computer time is provided by the operation department (Op) and programs are written by the programming department (P). The percentage of each service used by each department for a typical period is: Supplied User Op P Op --- 40 % P 30 % --- Sold to customers 70 % 60 % In a typical period, the operation department (Op) spends...
1. Computer Complex, Inc. has two main services: (1) time on a time-shared computer system and (2) proprietary computer programs. Computer time is provided by the operation department (Op) and programs are written by the programming department (P). The percentage of each service used by each department for a typical period is: Supplied User Op P Op --- 40% P 30% --- Sold to customers 70% 60% In a typical period, the operation department (Op) spends $4,500 and the programming...
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