x C Edgemon Company is A ·Q Accy 202 Chapter 19 St. × Secure https:// COND SECTI

Question

x C Edgemon Company is A ·Q Accy 202 Chapter 19 St. × Secure https:// COND SECTIONAL EXAM-100 Exam Points Help Save& Exit Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period: TotalAllocation Basis $31,000Number of employees Depreciation Advertising 21,000 Cost of goods sold 41,000Net sales 8 01 25 10 Drilling Grinding Total Item Number of employees Net sales Cost of goods sold 800 1,200 2,000 $330,000 $495,000 $825,00e s 79,800 $130,200 $218,000 The amount of the advertising cost that should be allocated to Grinding for the current period is: $16.400 Free 28 cf 40 ill Next >

Explanation / Answer

Advertising allocation rate = 41000/825000 = 0.04969 per $ sales

Grinding department advertising cost = (330000*0.04969) = 16400

so answer is a) $16400

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