The Managers of Conch, Inc If the Reciprocal Method Is Used, the Equation Representing the Accurate

question 66

Multiple Choice

The managers of Conch, Inc. want to determine the most accurate allocation of support department costs to operating departments. To make this allocation, the accounting department has collected the following data: $\begin{array}{llll}&&\text { Services Provided By }\\& \underline{\text { Computer}}&& \underline{\text { Cafeteria} }\\\text { Direct costs } & \$ 55,000 & & \$ 35,000 \\\text { Service provided to: } \\\quad \text { Computer department }&-- & & 15 \%\\ \text { Cafeteria } & 10 \% & &-- \\\text { Operating department 1 } & 50 \% & & 40 \% \\\text { Operating department 1 } & 40 \% & & 45 \%\\\end{array}$
If the reciprocal method is used, the equation representing the total cost of the computer department is:

• A) Computer costs = $55,000 + (0.15 × cafeteria cost)
• B) Computer costs = $55,000 + (0.10 × cafeteria cost)
• C) Computer costs = $55,000
• D) Computer costs = $55,000 + 0.10 × ($55,000 + 0.10 × computer cost)

Recognize the advantages and disadvantages of different communication methods.

Identify effective communication channels for specific purposes, such as immediacy of feedback or formality.

Understand the processes and strategies for generating and organizing content for messages.

Recognize the importance of audience analysis in determining the scope and approach of a message.

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Definitions:

Assembly Line

An approach that puts fabricated parts together at a series of workstations; used in repetitive processes.

Process Times

The duration required to complete a specific process or operation in a production or service environment.

Theory Of Constraints

A management philosophy focusing on identifying and addressing the most critical limitations that hinder achieving a goal, aiming for continuous improvement.

Goldratt And Cox

They are the authors of "The Goal," a book introducing the Theory of Constraints, a methodology for identifying and managing constraints to improve performance.