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Ch 09 Ex 9-3 Exercise 09-3 Service department expenses allocated to operating departments LO P2 points Advertising departmentComplete this question by entering your answers in the tabs below. Allocation of Exp Alloc of Serv Dept Complete the spreadsh

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  • Requirement 1

Advertising

Allocation Base

Percent of Allocation Base

Cost to be Allocated

Allocated Cost

Department

Numerator

Denominator

% of Total

Books Dept

Dollar Sales

$                           184,900.00

$           430,000.00

43%

$       57,800.00

$         24,854.00

Magazines Dept

Dollar Sales

$                           107,500.00

$           430,000.00

25%

$       57,800.00

$         14,450.00

Newspapers Dept

Dollar Sales

$                           137,600.00

$           430,000.00

32%

$       57,800.00

$         18,496.00

Totals

Dollar Sales

$                           430,000.00

$           430,000.00

100%

$       57,800.00

$         57,800.00

Purchasing

Allocation Base

Percent of Allocation Base

Cost to be Allocated

Allocated Cost

Department

Numerator

Denominator

% of Total

Books Dept

Purchase Orders

                                        816

                      1,700

48%

$       57,800.00

$         27,744.00

Magazines Dept

Purchase Orders

                                       476

                      1,700

28%

$       57,800.00

$         16,184.00

Newspapers Dept

Purchase Orders

                                        408

                      1,700

24%

$       57,800.00

$         13,872.00

Totals

Purchase Orders

                                      1,700

                      1,700

100%

$       57,800.00

$         57,800.00

  • Requirement 2

Allocation of Expenses to Departments

Allocation Base

Expense Account Balance

Advertising Dept.

Purchasing Dept.

Books Dept.

Magazines Dept.

Dept.Newspapers Dept.

Total department expenses

$                578,000.00

$                             57,800.00

$             57,800.00

$          138,700.00

$      115,600.00

$        208,100.00

   Service Dept Expenses:

Advertising Dept. Sales

$                             -  

$                            (57,800.00)

$           24,854.00

$       14,450.00

$         18,496.00

Purchasing Dept. Purch. orders

$                             -  

$            (57,800.00)

$           27,744.00

$       16,184.00

$         13,872.00

Total expenses allocated to operating depts.

$                578,000.00

$                                        -  

$                        -  

$          191,298.00

$      146,234.00

$        240,468.00

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