The following is taken from Clausen Company\'s internal records of its factory w

Question

The following is taken from Clausen Company's internal records of its factory with two operating departments. The cost driver for indirect labor is direct labor hours, and the cost driver for the remaining items is number of hours of machine use. Compute the total amount of rent and utilities allocated to Dept. 2 using activity-based costing Direct Labor Machine Hours 8,580 7,020 15,600 2 Hours polnts Operating Dept. 1 Operating Dept. 2 Totals 936 2,184 3, 120 Factory overhead costs Rent and utilities Indirect labor Depreciation Equipment $21,900 17,500 14,200 $53, 600 Total factory overhead

Explanation / Answer

Answer is $9855

Particulars Amt Rent and Utilities (A)    21,900.00 Machine Hours (B)    15,600.00 Per Hours (C = A/B)              1.40 Department 2 Hours (D)      7,020.00 Cost Allocated      9,855.00

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