Business, 05.05.2020 06:55, blewcblankz56

Woh Che 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.

Indirect Expense Cost Allocation Base
Supervision $84,000 Number of employees
Utilities 65,000 Square feet occupied
Insurance 30,000 Value of assets in use
Total $179,000

Departmental data for the company’s recent reporting period follow.

Department Employees Square Feet Asset Values
Materials 27 25,000 $6,000
Personnel 9 5,000 1,200
Manufacturing 63 55,000 37,800
Packaging 51 15,000 15,000
Total 150 100,000 $60,000

Required:
a. Use this information to allocate each of the three indirect expenses across the four departments.
b. Prepare a summary table that reports the indirect expenses assigned to each of the four departments.

Answers: 3

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Woh Che Co. has four departments: Materials, Personnel, Manufacturing, and Packaging. In a recent mo...