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Lucia Company has two service departments: Office and Purchasing. Total expenses for the Office is $25,000 and for Purchasing is $56,200. Expenses for the Office
Lucia Company has two service departments: Office and Purchasing. Total expenses for the Office is $25,000 and for Purchasing is $56,200. 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 | Sales | Purchase Orders |
---|---|---|
Books | $ 186,200 | 546 |
Magazines | 95,000 | 364 |
Newspapers | 98,800 | 390 |
Total | $ 380,000 | 1,300 |
Allocate the expenses from (a) the Office and (b) Purchasing to each of the companys three operating departments using the given information.
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