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CA7 Patapum R

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CA7 Patapum R
COST ACCOUNTING Patapum

The company Patapum is engaged in the manufacture of fireworks. At the end of the most recent campaign for St. Joan, Patapum wants to study the campaign’s cost. For the month of January, we know the following data: The production process is organized in sections, three operational and two service departments, and there are non-­‐operational sections as well: •




The first section, Powder, produces gunpowder from raw materials A and B. The second section is Packing, where firecrackers are made, and Finally there is the Decoration department, which gives an artistic touch to the fireworks. There are two service departments: Cleaning, which monitors that everything is in optimum conditions for the production process, and Safety, which ensures that the company complies with all safety protocols.

After the first step allocation, total manufacturing overhead costs allocated in each department are:

Department Powder Decoration Sales Cleaning

First stage 112,000.00 109,100.00 12,000.00 10,000.00

Department Packing Administration Safety

First stage 140,000.00 6,000.00 19,700.00

The work developed by the service departments is:

Safety Cleaning

Safety -­‐-­‐ 75 hours

Cleaning Powder Packing Decoration 10% 35% 35% 20% -­‐-­‐ 1,125 h. 1,125 h. 600 h.

Sales

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