Prepare a summary table that reports the indirect expenses assigned to each of t
ID: 2525212 • Letter: P
Question
Prepare a summary table that reports the indirect expenses assigned to each of the four departments.
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.
Departmental data for the company’s recent reporting period follow.
1. Use this information to allocate each of the three indirect expenses across the four departments.
2. Prepare a summary table that reports the indirect expenses assigned to each of the four departments.
Use this information to allocate each of the three indirect expenses across the four departments.
Explanation / Answer
Ans.1 Suprevision expenses: Allocation base Percent of Allocation Base Cost to be allocated Allocated cost Department Numerator Denominator % of Total Material 40 40 160 25% 84100 21025 Personnel 8 8 160 5% 84100 4205 Manufacturing 64 64 160 40% 84100 33640 Packaging 48 48 160 30% 84100 25230 Totals 160 100% 84100 Utilities: Allocation base Percent of Allocation Base Cost to be allocated Allocated cost Department Numerator Denominator % of Total Material 31000 31000 155000 20% 66000 13200 Personnel 15500 15500 155000 10% 66000 6600 Manufacturing 77500 77500 155000 50% 66000 33000 Packaging 31000 31000 155000 20% 66000 13200 Totals 155000 100% 66000 Insurance: Allocation base Percent of Allocation Base Cost to be allocated Allocated cost Department Numerator Denominator % of Total Material 7600 7600 76000 10% 30500 3050 Personnel 2280 2280 76000 3% 30500 915 Manufacturing 50160 50160 76000 66% 30500 20130 Packaging 15960 15960 76000 21% 30500 6405 Totals 76000 100% 30500 % of Total = Numerator / Denominator * 100 Ans.2 Department Supervision Utilities Insurance Total Material 21025 13200 3050 37275 Personnel 4205 6600 915 11720 Manufacturing 33640 33000 20130 86770 Packaging 25230 13200 6405 44835 Totals 84100 66000 30500 180600