Exercise 9-4 Indirect payroll expense allocated to departments LO P2 Jessica Por

Question

Exercise 9-4 Indirect payroll expense allocated to departments LO P2 Jessica Porter works in both the jewelry department and the cosmetics department of a retail store. Porter assists customers in both departments and arranges and stocks merchandise in both departments. The store allocates Porter's $17,900 annual wages between the two departments based on the time worked in the two departments. Jessica reported the following hours and activities spent in the two departments Selling in jewelry department Arranging and stocking merchandise in jewelry department Selling in cosmetics department Arranging and stocking merchandise in cosmetics department Idle time spent waiting for a customer to enter one of the departments 57.0 hours 7.0 hours 13.0 hours 8.0 hours 5.0 hours Allocate Jessica's annual wages between the two departments Department Hours worked ercent of Hours worked Wages Allocation Numerator | Denominator | % of Hours Jewelry Cosmetics Totals

Explanation / Answer

Department Hours worked Percent of Hours worked Wages Allocation Numerator Denominator % of Hours Jewelry 64 64 85 75.29% 17900 $13,478 Hosiery 21 21 85 24.71% 17900 $4,422 Totals 85 100% $17,900 Alternatively: Department Hours worked Percent of Hours worked Wages Allocation Numerator Denominator % of Hours Jewelry 64 64 85 75.29% 17900 $13,477 Hosiery 21 21 85 24.71% 17900 $4,423 Totals 85 100% $17,900

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