Calculate the operating income of each division when all corporate costs are allocated bas

Oil and Gas Upstream

Revenue 8,000.00
% of Revenue 0.25
Operating Costs 3,000.00
Operating Income 5,000.00
Allocated Costs 807.00
Division operating Income 4,193.00

Calculate the operating income of each division when all corporate costs are allocated using the 4 cost
Oil and Gas Upstream
Revenue 8,000.00
Operating Costs 3,000.00
Operating Income 5,000.00
% of Cost Pool 1 0.56
% of Cost Pool 2 0.25
% of Cost Pool 3 0.71
% of Cost Pool 4 0.30
Cost Pool 1 1,120.00
Cost Pool 2 200.00
Cost Pool 3 145.00
Cost Pool 4 67.50
Allocated costs 1,532.50

Division Operating Income 3,467.50

Allocate the indirect costs to each division equally:

Bread
Total revenues 21,300,000.00
Direct costs 14,100,000.00
Segment margin 7,200,000.00
Allocated costs 1,650,000.00
Division operating income 5,550,000.00

Allocate headquarter costs using the proposed allocation base:

Bread
No. of Employee 600.00
Square feet of space 18,000.00

HR costs 1,700,000.00
Accounting costs 1,300,000.00
Rent and depreciation 1,440,000.00
Other 510,000.00

Bread
Total revenues 21,300,000.00
Direct costs 14,100,000.00
Segment margin 7,200,000.00
% of no of employees 0.60
% of no of square feet 0.60
% of revenue 0.54
Allocated HR costs 1,020,000.00
Allocated Accounting costs 708,184.14
Allocated rent and depreciation 864,000.00
Allocated other costs 170,000.00
Division operating income 4,437,815.86

Use dual rate method:

Budgeted fixed cost 800.00
Variable cost 1,500.00

Fixed cost allocated to loading 800*150

Variable cost allocated to loading 1500*150
Total cost

Fixed cost allocated to off-loading 800*100

Variable cost allocated to off-loading 1500*75
Total cost

Direct method
AS
Budgeted overhead costs before allocation 600,000.00
Allocation of AS costs (40/75, 35/75) (600,000.00)
Allocation of IS costs (30/90, 60/90)
-

AS
Budgeted overhead costs before allocation 600,000.00
Allocation of AS costs (25%, 40%, 35%) (600,000.00)
Allocation of IS costs (30/90, 60/90)
-

AS
Budgeted overhead costs before allocation 600,000.00
Allocation of IS costs (10%, 30%, 60%) 240,000.00
Allocation of AS costs (40/75, 35/75) (840,000.00)
-
orate costs are allocated based on revenues of each division:
Oil and Gas Downstream Chemical Products Copper Mining
16,000.00 4,800.00 3,200.00
0.50 0.15 0.10
15,000.00 3,800.00 3,500.00
1,000.00 1,000.00 (300.00)
1,614.00 484.20 322.80
(614.00) 515.80 (622.80)

ts are allocated using the 4 cost pools:

Oil and Gas Downstream Chemical Products Copper Mining
16,000.00 4,800.00 3,200.00
15,000.00 3,800.00 3,500.00
1,000.00 1,000.00 (300.00)
0.24 0.12 0.08
0.50 0.15 0.10
0.14 0.14 -
0.40 0.20 0.10
480.00 240.00 160.00
400.00 120.00 80.00
29.00 29.00 -
90.00 45.00 22.50
999.00 434.00 262.50

1.00 566.00 (562.50)

Cake Doughnuts
4,300,000.00 13,500,000.00
2,900,000.00 7,550,000.00
1,400,000.00 5,950,000.00
1,650,000.00 1,650,000.00 4,950,000.00
(250,000.00) 4,300,000.00

Cake Doughnuts Total

150.00 250.00 1,000.00
3,000.00 9,000.00 30,000.00

Cake Doughnuts
 4,300,000.00 13,500,000.00 39,100,000.00
2,900,000.00 7,550,000.00
1,400,000.00 5,950,000.00
0.15 0.25
0.10 0.30
0.11 0.35
255,000.00 425,000.00
142,966.75 448,849.10
144,000.00 432,000.00
170,000.00 170,000.00
688,033.25 4,474,150.90

(=200000/250) per trip

per trip

120,000.00
225,000.00
345,000.00

80,000.00
112,500.00
192,500.00

IS GOVT CORP
2,400,000.00
320,000.00 280,000.00
(2,400,000.00) 800,000.00 1,600,000.00
- 1,120,000.00 1,880,000.00

IS GOVT CORP
2,400,000.00
150,000.00 240,000.00 210,000.00
(2,550,000.00) 850,000.00 1,700,000.00
- 1,090,000.00 1,910,000.00

IS GOVT CORP
2,400,000.00
(2,400,000.00) 720,000.00 1,440,000.00
448,000.00 392,000.00
- 1,168,000.00 1,832,000.00
Total
32,000.00

3,228.00
3,472.00

Total
32,000.00

7,000.00
25,000.00

30,000.00
2,000.00
800.00
203.00
225.00

3,472.00