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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
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 Allocation Basis Number of employees Office Expenses Salaries Total $ 50,000 Depreciation Advertising 34,000 68,000 Cost of goods sold Percentage of total sales Department Number of employees Drilling 1,800 Sales $ 388,000 Cost of goods sold Grinding 2,700 Total 4,500 582,000 $970,000 $ 140,600 229,400 $ 370,000 The amount of the total office expenses that should be allocated to Drilling for the current period is Multiple Choice $105,200 $60,120 $152.000
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