Buildz Corp Has Been Servicing the Production Casting Department for Five

question 12

Essay

Buildz Corp has been servicing the Production Casting Department for five years. Beginning next year, the company is adding a Production Molding Department to compliment the materials produced by the Production Casting Department. As a result, data center costs are expected to increase from $800,000 per year to $1,000,000 per year. The Production Molding Department will use 20% of the data center efforts.
Required:
a.Using the stand-alone cost-allocation method, identify the amount of data center cost that will be allocated to Production Casting and the Production Molding Department next year.
b.Using the incremental cost-allocation method, identify the amount of data center cost that will be allocated to Production Casting and the Production Molding Department next year.

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Definitions:

Psychoanalysts

Professionals who practice psychoanalysis, a therapeutic approach developed by Freud, focusing on exploring unconscious motives and conflicts.

Toilet Training

is the process of teaching a young child to use the toilet for urination and defecation independently.

Electra Complex

is a psychoanalytic theory proposing that a girl's psychosexual competition with her mother for possession of her father.