At the Christopher Company, the Cost of the Library and Information

question 200

Essay

At the Christopher Company, the cost of the library and information centre has always been charged to the various departments based upon the number of employees.Recently, opinions gathered from the department managers indicated that the number of engineers might also be a predictor of personnel costs to be assigned.Total library and information costs are $150,000. Required:
Using the above data, prepare a report that contrasts the different amounts of the library and information centre cost that would be allocated to each of the departments if the cost driver used is:
a.number of employees.
b.the number of engineers.
c.Which cost estimation method is being used by Christopher Company?

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Definitions:

Home Mortgage Loans

Loans provided by financial institutions to individuals for the purpose of purchasing residential properties, secured by the property itself.

Savings Banks

Financial institutions primarily engaged in accepting savings deposits and making loans and other investments.

Money Market Mutual Funds

Investment funds that pool money from investors to purchase short-term, high-quality debt securities like treasury bills and commercial paper.

M1

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits and checking accounts.