Question
Exercise 9-5 Departmental expense allocations LO P2 Woh Che Co. has four departments: materials, personnel, manufacturing, and packaging. In a recent month, the four departments
Exercise 9-5 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 | $ | 84,200 | Number of employees |
Utilities | 67,000 | Square feet occupied | |
Insurance | 31,000 | Value of assets in use | |
Total | $ | 182,200 | |
Departmental data for the companys recent reporting period follow.
Department | Employees | Square Feet | Asset Values | |||||||||
Materials | 34 | 41,250 | $ | 11,550 | ||||||||
Personnel | 17 | 8,250 | 3,080 | |||||||||
Manufacturing | 68 | 90,750 | 46,200 | |||||||||
Packaging | 51 | 24,750 | 16,170 | |||||||||
Total | 170 | 165,000 | $ | 77,000 | ||||||||
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.
|
Prepare a summary table that reports the indirect expenses assigned to each of the four departments.
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started