MARATHON RUNNING SHOPDepartmental Expense Allocation SpreadsheetFor Year Ended December 31, 2019Expense TotalsAdvertisingAdministrativeShoesClothingDirect expenseIndirect utilities expensesTotal dept. exp.0.Service Dept. ExpensesAdvertising Dept.Administrative Dept.Total expenses allocated0 $0 $%24%24%24 Marathon Running Shop has two service departments (advertising and administrative) and two operating departments (shoes andclothing). The table that follows shows the direct expenses incurred and square footage occupied by all four departments, as well astotal sales for the two operating departments for the year 2019.Direct ExpensesSquare Feet500SalesDepartmentAdvertisingAdministrative$ 15,00027,000103,00013,0007004,1004,700$124,000186,000ShoesClothingThe advertising department developed and distributed 190 advertisements during the year. Of these, 38 promoted shoes and 152promoted clothing. Utilities expense of $74,000 is an indirect expense to all departments.Complete a departmental expense allocation spreadsheet for Marathon Running Shop. The spreadsheet should assign (1) directexpenses to each of the four departments, (2) the $74,000 of utilities expense to the four departments on the basis of floor spaceoccupied, (3) the advertising department's expenses to the two operating departments on the basis of the number of ads placed thatpromoted a department's products, and (4) the administrative department's expenses to the two operating departments based on theamount of sales.

The expenses of service department will be allocated to operating department on the basis given in…

MARATHON RUNNING SHOP Departmental Expense Allocation Spreadsheet For Year Ended December 31, 2019 Expense Totals Advertising Administrative Shoes Clothing Direct expense Indirect utilities expenses Total dept. exp. Service Dept. Expenses Advertising Dept. Administrative Dept. of Total expenses allocated 2$ $ $ 0 $

MARATHON RUNNING SHOP Departmental Expense Allocation Spreadsheet For Year Ended December 31, 2019 Expense Totals Advertising Administrative Shoes Clothing Direct expense Indirect utilities expenses Total dept. exp. Service Dept. Expenses Advertising Dept. Administrative Dept. of Total expenses allocated 2$ $ $ 0 $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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