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Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments

Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two operating departments using different allocation bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 44,000 Number of employees
Depreciation 25,000 Cost of goods sold
Advertising 48,000 Percentage of total sales
Department Number of employees Sales Cost of goods sold
Drilling 1,600 $ 348,000 $ 106,400
Grinding 2,400522,000173,600
Total 4,000 $ 870,000 $ 280,000

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