Exercise 22-5 Departmental expense allocations LO P2

Woh Che Co. has four departments: materials, personnel, manufacturing, and packaging. In a recent month, the four departments incurred three shared indirect expenses. The amounts of these indirect expenses and the bases used to allocate them follow.

Indirect Expense		Cost	Allocation Base
Supervision	$	84,300	Number of employees
Utilities		68,000	Square feet occupied
Insurance		31,500	Value of assets in use
Total	$	183,800

Departmental data for the companys recent reporting period follow.

Department	Employees				Square Feet				Asset Values
Materials		36				52,500				$	11,700
Personnel		9				17,500					3,900
Manufacturing		72				78,750					47,580
Packaging		63				26,250					14,820
Total		180				175,000				$	78,000

1. Use this information to allocate each of the three indirect expenses across the four departments. 2. Prepare a summary table that reports the indirect expenses assigned to each of the four departments.

Use this information to allocate each of the three indirect expenses across the four departments. Supervision expenses Department Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Numerator Denominator % of Total Materials Personnel Manufacturing Packaging Totals Utilities Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Numerator Denominator % of Total Materials Personnel Manufacturing Packaging Totals Complete this question by entering your answers in the tabs below. Required Required 2 Prepare a summary table that reports the indirect expenses assigned to each of the four departments. Supervision Utilities Insurance Total Materials Personnel Manufacturing Packaging Totals