13

Diaz Company is a retail store with two operating departments, Clothes and Shoes. Information follows. Clothes $ 819,000 470,000 Shoes $ 441,000 286,650 For Year Ended December 31 Sales Cost of goods sold Direct expenses: Wages Supplies used Depreciation 121, . 13 , 17,000 87,000 10,7ee 12,500 The company reports the following Indirect expenses for the year. Indirect Expense Amount Allocation Base Utilities $ 7,600 Square feet of space occupied Supervisor salaries 35,000 Number of employees in department Additional information about the two departments follows Department Square Footage Number of Employees Clothes 25, 200 60 Shoes 16,800 40 Required: 1. Allocate indirect expenses to the two operating departments 2. Prepare departmental income statements, Required 1 Required 2 Allocate indirect expenses to the two operating departments. Allocation of $7,600 of utilities expense Department Square Footage Clothes Percent of Total Cost Allocated Shoes Total 0 0% $ 0 Allocation of $35,000 of supervisor salaries expense Employees Percent of Total Cost Allocated Clothes Shoes Total 0 0% $ 0 Required 1 Required 2 Prepare departmental income statements. DIAZ COMPANY Departmental Income Statements For Year Ended December 31 Clothes Shoes 0 0 Expenses Total expenses 0 0