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Home Q & A Board Other Fields Homework Help Business Economics
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ashly138 ashly138
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Posts: 686
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6 years ago
Smith Company and Jones Company currently share an employee dining facility. Jones Company employs fewer people and believes that they should not be required to pay one-half of the $300,000 costs incurred for the facility. An independent consulting firm stipulated that Smith Company could receive the same services for $150,000 while Jones's employees could receive comparable services for $100,000.
What will be Jones's allocated cost if the stand-alone method is used?
A) $83,333
B) $100,000
C) $120,000
D) $150,000
E) $180,000
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
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wrote...
#1
6 years ago
C
Explanation:  C) Stand-alone = ($100,000/$250,000) × $300,000 = $120,000
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