Reference no: EM132461254

The Copy & Paste Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year:

Budgeted cost of operating the copying facitliy for 400,000 to 600,000 copies

Fixed cost per year                             $60,000

Variable costs                                    3 cents per copy

Budgeted long-run usage in copies per year:

Marketing department                        120,000 copies

Operations Department                     380,000 copiesco

1. Budgeted amounts are used to calculate the allocation rates.
2. Actual usage for the year by the Marketing Department was 80,000 copies and by the Operations Department was 360,000 copies.

Required

Problem 1: If a single-rate cost allocation method is used, what amount of copying facility costs will be budgeted for the Marketing Department?

Problem 2: If a single-rate cost allocation method is used, what amount of copying facility costs will be allocated to the Marketing Department? Assume actual usage is used to allocate copying costs.

Problem 3: If a dual-rate cost-allocation method is used, what amount of copying facility costs will be budgeted for the Operations Department?