By default base of earnings, Interest expense was allocated to profit centers in the amounts of:

Question 30 options:

A)	$2,000 to New Work, $3,000 to Repairs

B)	$8,000 to New Work, $2,000 to Repairs

C)	$4,000 to New Work, $6,000 to Repairs

D)	$6,000 to New Work, $4,000 to Repairs

Account Company Profit Centers New Work Repairs 800.000 S1,080,000 S720,000 Earnings Cost of Construction $500,000 Labor $300,000 $200,000 Material $900,000 $450,000 $450,000 Total Direct Cost 400,000 $750,000 S650,000 S400,000 $330,000 Gross Profit S70,000 Variable Operating Expense Auto and Truck $60,000 Interest $10,000 Total Variable S70,000 Operating Expense Fixed Operating Expense Depreciation $20,000 Salaries $80,000 Total Fixed Expense S100,000 S170,000 Total operating Expense Net Profit (before S230,000 tax) Tax (50%) $115,000 Net Profit after tax) S1 15,000 Account Company Profit Centers New Work Repairs 800.000 S1,080,000 S720,000 Earnings Cost of Construction $500,000 Labor $300,000 $200,000 Material $900,000 $450,000 $450,000 Total Direct Cost 400,000 $750,000 S650,000 S400,000 $330,000 Gross Profit S70,000 Variable Operating Expense Auto and Truck $60,000 Interest $10,000 Total Variable S70,000 Operating Expense Fixed Operating Expense Depreciation $20,000 Salaries $80,000 Total Fixed Expense S100,000 S170,000 Total operating Expense Net Profit (before S230,000 tax) Tax (50%) $115,000 Net Profit after tax) S1 15,000