Additional information about the two departments follows.

Allocate indirect expenses to the two operating departments.

Prepare departmental income statements.

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Allocate indirect expenses to the two operating departments. Diaz Company is a retail store with two operating departments, Clothes and Shoes. Information follows.

For Year Ended December $31$ Clothes Shoes

Sales $ $806,400$ $ $453,600$

Cost of goods sold $485,000294,840$

Direct expenses:

Wages $117,00085,000$

Supplies used $17,50010,900$

Depreciation $16,50013,500$

The company reports the following indirect expenses for the year.

Indirect Expense Amount Allocation Base

Utilities $ $6,000$ Square feet of space occupied

Supervisor salaries $27,000$ Number of employees in department

Additional information about the two departments follows.

Department Square Footage Number of Employees

Clothes $32,20084$

Shoes $13,80036$