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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 Salaries $30,000 Allocation Base Number of employees Depreciation 20,000 Cost of goods sold Advertising 40,000 Percentage of total sales Department Number of employees Drilling 1,000 Grinding 1,500 Total 2,500 Sales Cost of goods sold $325,000 $75,000 475,000 125,000 $800,000 200,000 The amount of depreciation that should be allocated to Grinding for the current period is Multiple Choice $20,000 $25,000 $7.500
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