A company has two departments, A and B that incur delivery expenses. An analysis

Question

A company has two departments, A and B that incur delivery expenses. An analysis of the total delivery expense of $11,000 indicates that Dept. A had a direct expense of $1,200 for deliveries and Dept. B had no direct expense. The indirect expenses are $9,800. The analysis also indicates that 60% of regular delivery requests originate in Dept. A and 40% originate in Dept. B. Departmental delivery expenses for Dept. A and Dept. B, respectively, are:

A company has two departments, A and B that incur delivery expenses. An analysis of the total delivery expense of $11,000 indicates that Dept. A had a direct expense of $1,200 for deliveries and Dept. B had no direct expense. The indirect expenses are $9,800. The analysis also indicates that 60% of regular delivery requests originate in Dept. A and 40% originate in Dept. B. Departmental delivery expenses for Dept. A and Dept. B, respectively, are:

Explanation / Answer

Calculation of the Delivery Expense Dept A Dept B Direct Expense 1200 0 Indirect 9800*60% 5880 3920 (9800*40%) Total Delivery Expenses 7080 3920

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