Gomez Company has two service departments (Personnel and Office) and two operating departments (Shoes and Clothing). Following are the direct expenses and square feet occupied by the four departments, and the total sales for the two operating departments Department Direct Expenses Square Feet Sales Personnel $ 15,000 1.000 Office 28,000 990 Shoes 123,000 3,330 $ 166,400 clothing 18,000 3,600 93,600 The company also has $45,000 of utilities expense, which is an indirect expense to all departments and is allocated to the four departments based on square feet occupied. The Shoes department has 72 employees and the Clothing department has 168 employees. Personnel expense is allocated to operating departments based on the number of employees. Office expense is allocated to operating departments based on sales. 1. Allocate utilities expense to the four departments, 2. Allocate personnel expense to the Shoes and Clothing departments 3. Allocate office expense to the shoes and Clothing departments Percent of Allocation Base Cost to be Allocated Utilities Allocated Cost Numerator Denominator Allocation Base Square feet occupied 1,080 990 45,000 5 45,000 Department Personnel Office Shoes Clothing Totals 1,000 990 3,330 3,600 9,000 0.000 9,000 9,000 % of Total 12.00% $ 11.00% 37.00% 40.00% 100.00% 5.400 4,950 16,650 18.000 45,000 3,330 3,600 9,000 45.000 45,000 5 Personnel expense Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Denominator Department Shoes Clothing Totals 240 Number of employees 72 168 240 Numerator 72 168 % of Total 30.00% 70.00% 100.00% 240 Office expense Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cont Sales $ Department Shoes Clothing Totals Numerator Denominator 166.400 $ 166.400 5 250.000 93,600 3,600 200.000 260,000 % of Total 54.00% 36.00% 100.00% $