Won Han Co. has four departments: materials, personnel, manufacturing, and packa
ID: 2513699 • Letter: W
Question
Won Han Co. has four departments: materials, personnel, manufacturing, and packaging. In a recent month, the four departments incurred three shared indirect expenses. The amounts of these indirect expenses and the bases used to allocate them follow.
Use this information to allocate each of the three indirect expenses across the four departments. (Round your intermediate and final answers to the nearest whole dollar. Omit the "$" & "%" signs in your response.)
Prepare a summary table that reports the indirect expenses assigned to each of the four departments. (Round your intermediate and final answers to the nearest whole dollar. Omit the "$" sign in your response.)
Indirect Expense Cost Allocation Base Supervision $ 70,000 Number of employees Utilities 64,000 Square feet occupied Insurance 17,000 Value of assets in use Total $ 151,000Explanation / Answer
Answer
Percent of Allocation Base
Supervision expenses
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
Number of employees
18
123
15%
$ 70,000.00
$ 10,243.90
Personnel
Number of employees
8
123
7%
$ 70,000.00
$ 4,552.85
Manufacturing
Number of employees
65
123
53%
$ 70,000.00
$ 36,991.87
Packaging
Number of employees
32
123
26%
$ 70,000.00
$ 18,211.38
Totals
123
123
100%
$ 70,000.00
$ 70,000.00
Percent of Allocation Base
Utilities
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
SquareFeet
29000
97200
30%
$ 64,000.00
$ 19,094.65
Personnel
SquareFeet
4700
97200
5%
$ 64,000.00
$ 3,094.65
Manufacturing
SquareFeet
50000
97200
51%
$ 64,000.00
$ 32,921.81
Packaging
SquareFeet
13500
97200
14%
$ 64,000.00
$ 8,888.89
Totals
97200
97200
100%
$ 64,000.00
$ 64,000.00
Percent of Allocation Base
Insurance
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
Asset Values
34000
88300
39%
$ 17,000.00
$ 6,545.87
Personnel
Asset Values
1200
88300
1%
$ 17,000.00
$ 231.03
Manufacturing
Asset Values
38300
88300
43%
$ 17,000.00
$ 7,373.73
Packaging
Asset Values
14800
88300
17%
$ 17,000.00
$ 2,849.38
Totals
88300
88300
100%
$ 17,000.00
$ 17,000.00
Supervision
Utilities
Insurance
Total
Materials
$ 10,243.90
$ 19,094.65
$ 6,545.87
$ 35,884.42
Personnel
$ 4,552.85
$ 3,094.65
$ 231.03
$ 7,878.53
Manufacturing
$ 36,991.87
$ 32,921.81
$ 7,373.73
$ 77,287.41
Packaging
$ 18,211.38
$ 8,888.89
$ 2,849.38
$ 29,949.65
Totals
$ 70,000.00
$ 64,000.00
$ 17,000.00
$ 1,51,000.00
Percent of Allocation Base
Supervision expenses
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
Number of employees
18
123
15%
$ 70,000.00
$ 10,243.90
Personnel
Number of employees
8
123
7%
$ 70,000.00
$ 4,552.85
Manufacturing
Number of employees
65
123
53%
$ 70,000.00
$ 36,991.87
Packaging
Number of employees
32
123
26%
$ 70,000.00
$ 18,211.38
Totals
123
123
100%
$ 70,000.00
$ 70,000.00
Percent of Allocation Base
Utilities
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
SquareFeet
29000
97200
30%
$ 64,000.00
$ 19,094.65
Personnel
SquareFeet
4700
97200
5%
$ 64,000.00
$ 3,094.65
Manufacturing
SquareFeet
50000
97200
51%
$ 64,000.00
$ 32,921.81
Packaging
SquareFeet
13500
97200
14%
$ 64,000.00
$ 8,888.89
Totals
97200
97200
100%
$ 64,000.00
$ 64,000.00
Percent of Allocation Base
Insurance
Allocation Base
Numerator
Denomintator
% of total
Costs to be allocated
Allocated Cost
Departments:
Materials
Asset Values
34000
88300
39%
$ 17,000.00
$ 6,545.87
Personnel
Asset Values
1200
88300
1%
$ 17,000.00
$ 231.03
Manufacturing
Asset Values
38300
88300
43%
$ 17,000.00
$ 7,373.73
Packaging
Asset Values
14800
88300
17%
$ 17,000.00
$ 2,849.38
Totals
88300
88300
100%
$ 17,000.00
$ 17,000.00
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