Question

1) The following is a partly completed lower section of a departmental expense distribution spreadsheet for Stoneham. It reports the total amounts of direct as well as indirect expenses for the four departments. Purchasing department expenses are owed to the operating departments on the basis of purchase orders. Upkeep department expenses are allocated based on square footage. Calculate the amount of purchasing department expenditure to be allocated to Fabrication

Purchasing Maintenance Fabrication Assembly
Operating costs $36,000 $20,400 $100,000 $66,000
No. of purchase orders 15 5
Sq.ft. of space 3,500 2,500

a) $11,900
b) $19,800
c) $8,500
d) $27,000
e) $9,000

2) Dresden, Inc. has four departments. Information around these departments is listed below. If owed maintenance cost is based on floor space busy by each, calculate the amount of maintenance cost owed to the Cutting Department.

Maintenance Cutting Assembly Packaging
Direct costs $14,000 $20,000 $60,000 $35,000
Sq. ft. of space 950 1,450 2,450 3,350
No. of employees 11 2 11 11

a) $4,524
b) $2,800
c) $14,000
d) $7,000
e) $3,119

3) A sawmill accepted a shipment of logs for $38,000. When changed the logs produced 760,000 board feet of lumber in the following grades

Type 1 - 290,000 bd. ft. priced to sell at $.17 per bd. ft
Type 2 - 260,000 bd. ft. priced to sell at $.17 per bd. ft
Type 3 - 210,000 bd. ft. priced to sell at $.17 per bd. ft

Calculate the cost to be allocated to Type 1 and Type 2 lumber, respectively, if the value basis is used. (Don't round your intermediate calculations.)

a) $38,000; $44,200
b) $14,500; $13,000
c) $10,944;$10,500
d) $71,400; $71,400
e) $44,200; $35,700