Exercise 22-5 Departmental expense allocations LO P2 Woh Che Co. has four depart
ID: 2513270 • Letter: E
Question
Exercise 22-5 Departmental expense allocations LO P2 Woh Che Co. has four departments: materials, personnel, manufacturing, and packaging. In a recent month, the four incurred three shared indirect expenses. The amounts of these indirect expenses and the bases used to allocate them follow nts Supervision Utilities 82,500 Number of onployees 0,000 square feet occupied 22,500 Value of assets in use $155, 000 Departmental data for the company's recent reporting period follow. Materials 25, 000 5, 000 5S,000 15, 000 100,000 $ 6,000 1, 200 37,800 15, 000 $60,000 27 Manufacturing Packaging 63 51 150 1. Use this information to allocate each of the three indirect expenses across the four departments 2. Prepare a summary table that reports the indirect expenses assigned to each of the four departments Complete this question by entering your answers in the tabs below Required 1 Required 2 Prev 1 of 5 EE Next ere to searchExplanation / Answer
Supervision Expense Allocation Base Percent of Allocation Base Cost to be allocated Allocated Cost Department No. of Employee Numerator Denominator % of Total Material 27 27 150 18% $14,850 $14,850 Personnel 9 9 150 6% $4,950 $4,950 Manufacturing 63 63 150 42% $34,650 $34,650 Packaging 51 51 150 34% $28,050 $28,050 Total 150 150 150 100% 82500 82500 Utilities Allocation Base Percent of Allocation Base Cost to be allocated Allocated Cost Department Square Feet Occupied Numerator Denominator % of Total Material 25000 25000 100000 25% $12,500 $12,500 Personnel 5000 5000 100000 5% $2,500 $2,500 Manufacturing 55000 55000 100000 55% $27,500 $27,500 Packaging 15000 15000 100000 15% $7,500 $7,500 Total 100000 100000 100000 100% 50000 $50,000 Insurance Allocation Base Percent of Allocation Base Cost to be allocated Allocated Cost Department Value of Asset in Use Numerator Denominator % of Total Material 6000 6000 60000 10% $2,250 $2,250 Personnel 1200 1200 60000 2% $450 $450 Manufacturing 37800 37800 60000 63% $14,175 $14,175 Packaging 15000 15000 60000 25% $5,625 $5,625 Total 60000 60000 60000 100% 22500 $22,500 Summary Table to Show Indirect Expense assigned to Each Department Department Supervision Utilities Insurance Total Material $14,850 $12,500 $2,250 $29,600 Personnel $4,950 $2,500 $450 $7,900 Manufacturing $34,650 $27,500 $14,175 $76,325 Packaging $28,050 $7,500 $5,625 $41,175 Total $82,500 $50,000 $22,500 $155,000
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