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Business
Accounting
Office Expenses Total Allocation Basis Salaries $30,000 Number of employees Depreciation Advertising 20,000 Cost of goods sold 40,000 Net sales Item Drilling Grinding Total Number of employees 1,000 1,500 2,500 Net sales $325,000 $475,000 $800,000 Cost of goods sold $ 75,000 $125,000 $200,000

Office Expenses Total Allocation Basis Salaries $30,000 Number of employees Depreciation Advertising 20,000 Cost of goods sold 40,000 Net sales Item Drilling Grinding Total Number of employees 1,000 1,500 2,500 Net sales $325,000 $475,000 $800,000 Cost of goods sold $ 75,000 $125,000 $200,000

FINANCIAL ACCOUNTING
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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Marks corporation has two operating departments. Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following info (tables in picture) is given. The amount of total office expenses that should be allocated to Grinding for the current period is?

Office Expenses Total Allocation Basis Salaries $30,000 Number of employees Depreciation Advertising 20,000 Cost of goods sold 40,000 Net sales Item Drilling Grinding Total Number of employees 1,000 1,500 2,500 Net sales $325,000 $475,000 $800,000 Cost of goods sold $ 75,000 $125,000 $200,000
Transcribed Image Text:Office Expenses Total Allocation Basis Salaries $30,000 Number of employees Depreciation Advertising 20,000 Cost of goods sold 40,000 Net sales Item Drilling Grinding Total Number of employees 1,000 1,500 2,500 Net sales $325,000 $475,000 $800,000 Cost of goods sold $ 75,000 $125,000 $200,000
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