Service Department Charges In divisional income statements prepared for Demopolis Company, the Payroll Department costs are charged back to user divisions or basis of the number of payroll distributions, and the Purchasing Department costs are charged back on the basis of the number of purchase requisitions. The payroll Department had expenses of $61,952, and the Purchasing Department had expenses of $27.730 f the year. The following annual data for Residential, Commercial, and Government Contract divisions were obtained from corporate records: Government Residential Commercial Contract Sales $ 580,000 $ 768,000 $ 1,764,000 Number of employees Weekly payroll (52 weeks per year) 110 80 85 Monthly payroll 30 41 28 umber of purchase requisitions per year 2,000 1,400 1,300 a. Determine the total amount of payroll checks and purchase requisitions processed per year by the company and each division. Residential Commercial Government Contract Number of payroll checks: Weekly payroll Monthly payroll Total Number of purchase requisitions per year b. Using the activity base information in (a), determine the annual amount of payroll and purchasing costs charged back to the Residential, Commercial, and Government Contract divisions from payroll and purchasing services. Do not round your interim calculations, round your answers to two decimal places, if required. Service department charge rates: Payroll Department per payroll check Purchasing Department per purchase requisition Monthly payroll Total Number of purchase requisitions per year b. Using the activity base information in (a), determine the annual amount of payroll and purchasing costs charged back to the Residential, Commercial, and Government Contract divisions from payroll and purchasing services. Do not round your interim calculations, round your answers to two decimal places, if required. Service department charge rates: Payroll Department per payroll check Purchasing Department per purchase requisition Residential Commercial Government Contract Ta Service department charges: Payroll Department Purchasing Department Total user of c. Residential's service department charge is higher than the other two divisions because Residential is a heavy service department services, Residential has many employees on a weekly payroll, which translates into a larger number of payro transactions Feedback Check My Work Add the number of weekly and monthly payroll check for each division. Add the number of requisitions for each division b. Divide the Payroll and Purchasing expenses by the appropriate activity base from (a) Then apply the rate per activity by the actual chocks and Toquisitions