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Exercise 22-3 (Algo) Service department expenses allocated to operating departments LO P2 Lucia Company has two service departments: Office and Purchasing. Total expenses for the
Exercise 22-3 (Algo) Service department expenses allocated to operating departments LO P2 Lucia Company has two service departments: Office and Purchasing. Total expenses for the Office is $42,800 and for Purchasing is $32,100. Expenses for the Office are allocated to operating departments based on sales. Expenses for Purchasing are allocated to operating departments based on purchase orders. Department Books Magazines Newspapers Total Sales $ 180,000 108,000 112,000 $ 400,000 Purchase Orders 1,170 520 910 2,600 Allocate the expenses from (a) the Office and (b) Purchasing to each of the company's three operating departments using the given information Allocation Base Cost to be Allocated Allocated Cost Percent of Allocation Base Numerator Denominator % of Total Office Department Books Magazines Newspapers Totals Allocation Base Cost to be Allocated Allocated Cost Percent of Allocation Base Numerator Denominator % of Total Purchasing Department Books Magazines Newspapers Totals
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