Problem 22-2A (Algo) Allocation of indirect expenses to departments LO P2 [The following information applies to the questions displayed below.] National Retail has two departments, Housewares and Sporting. Indirect expenses for the period follow. Rent Advertising Insurance Total $ 45,000 25,000 10,000 $80,000 The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of Indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect expenses to each department based on the square feet it occupied. The company now wants to allocate indirect expenses using the allocation bases shown below. Value of Insured Assets $ 45,000 55,000 $ 100,000 Department Housevares Sporting Total Square Feet 2,000 2,000 4,000 Problem 22-2A (Algo) Part 1 Sales $ 230,000 270,000 $ 500,000 Required: 1. Allocate indirect expenses to the two departments using the allocation method used in prior periods.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Problem 22-2A (Algo) Allocation of indirect expenses to departments LO P2
[The following information applies to the questions displayed below.]
National Retail has two departments, Housewares and Sporting.
Indirect expenses for the period follow.
Rent
Advertising
Insurance
Total
The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of
indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect
expenses to each department based on the square feet it occupied.
The company now wants to allocate indirect expenses using the allocation bases shown below.
Department
Housewares
Sporting
Total
$ 45,000
25,000
10,000
$ 80,000
Square Feet
2,000
2,000
4,000
Problem 22-2A (Algo) Part 1
Department
Housewares
Sporting
Required:
1. Allocate indirect expenses to the two departments using the allocation method used in prior periods.
Square Feet
Sales
$ 230,000
270,000
$ 500,000
Rate
Value of Insured.
Assets
$ 45,000
55,000
$ 100,000.
Total
Transcribed Image Text:Required information Problem 22-2A (Algo) Allocation of indirect expenses to departments LO P2 [The following information applies to the questions displayed below.] National Retail has two departments, Housewares and Sporting. Indirect expenses for the period follow. Rent Advertising Insurance Total The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect expenses to each department based on the square feet it occupied. The company now wants to allocate indirect expenses using the allocation bases shown below. Department Housewares Sporting Total $ 45,000 25,000 10,000 $ 80,000 Square Feet 2,000 2,000 4,000 Problem 22-2A (Algo) Part 1 Department Housewares Sporting Required: 1. Allocate indirect expenses to the two departments using the allocation method used in prior periods. Square Feet Sales $ 230,000 270,000 $ 500,000 Rate Value of Insured. Assets $ 45,000 55,000 $ 100,000. Total
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