Using the Direct Method, Pone Hill Company Allocates Janitorial Department

question 144

Multiple Choice

Using the direct method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has the following information about its two service departments and two production departments, Cutting and Assembly: The percentage (proportional) usage of the Janitorial Department by the Cutting Department is

• A)20%
• B)80%
• C)10%
• D)9.9%

Understand the concept of sales mix and its effect on company's profitability.

Identify and classify costs into fixed, variable, and mixed categories.

Calculate the break-even point for multiple product companies.

Understand the concept of contribution margin and its use in break-even analysis.

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Definitions:

Indirect Pattern

A communication strategy where the main point or conclusion is placed towards the end of the message, preceded by supporting details or explanations.

Organizational Strategy

A plan of action aimed at achieving the long-term goals and overall objectives of an organization.

Introductory Dependent Clauses

Phrases at the beginning of a sentence that cannot stand alone as complete sentences and depend on the rest of the sentence for their meaning.

Independent Clauses

Sentences or parts of sentences that can stand alone as complete thoughts because they have both a subject and a verb.