Xaric Industries operates two support departments, Personnel and Accounting, and two producing departments, Fabrication and Assembly. Information on the support percentages and cost for each department is as follows: Using the reciprocal method of allocating support costs, what is the total cost allocated to the Assembly Department from the two support departments?

Question

Xaric Industries operates two support departments, Personnel and Accounting, and two producing departments, Fabrication and Assembly. Information on the support percentages and cost for each department is as follows:  Using the reciprocal method of allocating support costs, what is the total cost allocated to the Assembly Department from the two support departments?

Quizplus · Accepted Answer

($15,000 + (.06 x $8,000)) ÷ (1-(.06 * .10)) = $15,573
($8,000 + (.10 x $15,000)) ÷ (1-(.06 * .10)) = $9,557
$15,573 x 55% = $8,565
$9,557 x 44% = $4,205
$8,565 + $4,205 = $12,771
 Per Op Costs + (Per % of acct x Acct op costs) ÷ (1 - (per % of Acct x Acct % of per)) = cost from per
acct Op Costs + (acct % of per x per op costs) ÷ (1 - (per % of Acct x Acct % of per)) = cost from acct
costs from per x assm-per % = cost from per to assm
costs from acct x assm-acct% =cost from acct to assm
cost from per to assm + cost from acct to assm = total cost alloc to assm

Xaric Industries Operates Two Support Departments, Personnel and Accounting, and Two