Exercise 22-6 Departmental expense allocation spreadsheet LO P2 Marathon Running Shop has two service departments (advertising and administrative) and two operating departments (shoes and clothing). The table that follows shows the direct expenses incurred and square footage occupied by all four departments, as well as total sales for the two operating departments for the year 2019. Sales Department Advertising Administrative Shoes Clothing Direct Expenses $ 15,000 28,000 123,000 18,000 Square Feet 1,080 990 3,330 3,600 $166,400 93,600 The advertising department developed and distributed 240 advertisements during the year. Of these, 72 promoted shoes and 168 promoted clothing. Utilities expense of $45,000 is an indirect expense to all departments. Complete a departmental expense allocation spreadsheet for Marathon Running Shop. The spreadsheet should assign (1) direct expenses to each of the four departments, (2) the $45,000 of utilities expense to the four departments on the basis of floor space occupied, (3) the advertising department's expenses to the two operating departments on the basis of the number of ads placed that promoted a department's products, and (4) the administrative department's expenses to the two operating departments based on the amount of sales. Utilities Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Floor space occupied Numerator Denominator % of Total 1,080 1,080 9,000 12.00 $ 45,000 $ 6,400 Advertising Administrative 990 990 9,000 11.00 45,000 4,950 Shoes 3,330 3,330 9,000 37.00 45,000 16,650 Clothing 3,600 3,600 9,000 40.00 45,000 17,000 Totals 9,000 100.00 $ 45,000 Advertising Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Number of ads Numerator Denominator % of Total Shoes 72 72 240 30.00 Clothing 168 168 240 70.00 Totals 240 100.00 Administrative Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Numerator Denominator % of Total Shoes 0 Clothing 0 Totals 0 MARATHON RUNNING SHOP Departmental Expense Allocation Spreadsheet For Year Ended December 31, 2019 Expense Totals Advertising Administrative Shoes Clothing Direct expense Indirect utilities expenses O Total dept. exp. 0 0 0 0 0 Service Dept. Expenses 0 Advertising Dept. Administrative Dept. 0 Total expenses allocated $ 0 $ $ 0 $ 0 $ 0