Allocation of Costs, accounting homework

Jan 14th, 2016
FratBro23
Category:
Accounting
Price: $5 USD

Question description


Discussions
To participate in the following discussions, go to this week's Discussion link in the left navigation.

Allocation of Costs
 
Analyze the following scenario: Jump Hospital currently allocates all maintenance department costs based on departmental square feet.  However, the manager of the pharmacy department has suggested that an ABC approach be used for the portion of the maintenance department costs that relate to repairing equipment.  Her contention is that the pharmacy has relatively little equipment that breaks.  However, it must subsidize many high-tech departments that require expensive equipment repairs.  Using the tables below, calculate the maintenance cost assigned to the pharmacy using the existing method and using an ABC approach.  Clearly label your calculations in your analysis.  Respond to at least two of your classmates’ postings.

Maintenance Costs

Routine Maintenance

Repairs

Total

Volume (Square Feet)

100,000

800

Labor Hours

10,000

4000

14,000

Labor Cost/Hour

$12.00

$18.00

$13.71

Supplies

$20,000

$80,000

$100,000

Administration

$15,000

 

Department Information

Pharmacy

All Other Departments

Total

Square Feet

2,000

98,000

100,000

Volume of Repairs

3

797

800

Hours of Repairs

6

3,994

4,000

Supplies Used for Repairs

$200

$79,800

$80,000

Investment Decision
 
Analyze the following scenario: Duncombe Village Golf Course is considering the purchase of new equipment that will cost $1,200,000 if purchased today and will generate the following cash disbursements and receipts.  Should Duncombe pursue the investment if the cost of capital is 8 percent?  Why?  Clearly label your calculations in your analysis.  You must respond to at least two of your classmates’ postings to receive full credit.

Year

Cash Receipts

Cash Disbursements

Net Cash Flow

1

1,000,000

500,000

500,000

2

925,000

475,000

450,000

3

800,000

450,000

350,000

4

750,000

430,000

320,000


Tutor Answer

(Top Tutor) Daniel C.
(997)
School: Carnegie Mellon University
PREMIUM TUTOR

Studypool has helped 1,244,100 students

8 Reviews


Summary
Quality
Communication
On Time
Value
ddg82
Dec 9th, 2016
" Thanks, good work "
tinytim47
Nov 25th, 2016
" Wow this is really good.... didn't expect it. Sweet!!!! "
kenmwao2
Nov 24th, 2016
" Solid work, thanks. "
jestin7
Nov 16th, 2016
" This tutor is great! "
lilmoe415
Nov 3rd, 2016
" Thank you, Thank you, for top quality work, this is your guy!! "
dontuwannaknow
Oct 11th, 2016
" Excellent work as always thanks so much "
thargrow
Oct 2nd, 2016
" Very Satisfied. "
SjSurvivor143
Sep 28th, 2016
" Thanks for the help. "
Ask your homework questions. Receive quality answers!

Type your question here (or upload an image)

1822 tutors are online

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors