Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Overroad Cycle Shop has two service departments (advertising and administration) and two operating departments (cycles and clothing). During 2011, the departments had the following direct

image text in transcribed
image text in transcribed
Overroad Cycle Shop has two service departments (advertising and administration) and two operating departments (cycles and clothing). During 2011, the departments had the following direct expenses and occupied the following amount of floor space. Dement Advertising Administrative Cycles Clothing Direct Expenses 16,000 18,500 101,600 11.900 Square Feet 1.08.8 1,152 6,336 4.224 The advertising department developed and distributed 100 advertisements during the year of these, 76 promoted cycles and 24 promoted clothing The store sok $300 000 of merchandise during the year of this amount, $225,000 is from the cycles department, and $75,000 is from the clothing department. The utilities expense of $64,000 is an indirect expense to all departments Complete the departmental expense allocation spreadsheet for Overroad Cycle Shop. Assign (1) direct expenses to each of the four departments, (2) the $64.000 of utilities exponse to the four departments on the basis of floor space occupied, (3) the advertising department's expenses to the two operating departments on the basis of the number of ads placed that promoted a department's products, and (4) the administrative department's expenses to the two operating departments based on the amount of sales. (Do not round your intermediate calculations and round final answers to the nearest dollar amount. Leave no cells blank - be certain to enter "0" wherever required. Negative amounts should be indicated by a minus sign. Omit the "S" sign in your response ) OVERROAD CYCLE SHOP Departmental Expense Allocation Sprendsheet For Year Ended December 31, 2011 Allocation of Expenses to Departments Expense Allocation Account Advertising Administrative Cycles Base Balance Dept. Dept Dept 1 16000 18500 $ Direct expenses 101600 Indirect utilities expenses Sq foot Clothing Dept. $ 11900 Total dept. exp Service Dept Expenses Advertising Dept Administrative Dept Ads Sales OVERROAD CYCLE SHOP Departmental Expense Allocation Spreadsheet For Year Ended December 31, 2011 Allocation of Expenses to Departments Expense Account Advertising Administrative Balance Dept Dept. 16000 18500 Allocation Base Cycles Dept. 101600 Direct expenses Indirect utilities expenses Clothing Dept. 11900 $ $ Sq. feet Total dept. exp. Service Dept. Expenses Advertising Dept Administrative Dept. Ads Sales Total exp. allocated to operating depts

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions