Free

90.2K

Verified Solution

Link Copied!

Exercise 9-3 Service department expenses allocated to operatingdepartments LO P2

Advertising department expenses of $57,800 and purchasingdepartment expenses of $57,800 of Cozy Bookstore are allocated tooperating departments on the basis of dollar sales and purchaseorders, respectively. Information about the allocation bases forthe three operating departments follows.
  

Department	Sales			Purchase Orders
Books	$	184,900			816
Magazines		107,500			476
Newspapers		137,600			408
Total	$	430,000			1,700

  
Complete the following table by allocating the expenses of the twoservice departments (advertising and purchasing) to the threeoperating departments.

Complete the following table by allocating the expenses of thetwo service departments (advertising and purchasing) to the threeoperating departments.

	Advertising Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Numerator Denominator % of Total Books Magazines Newspapers Totals Purchasing Allocation Base Percent of Allocation Base Cost to be Allocated Allocated Cost Department Numerator Denominator % of Total Books Magazines Newspapers Totals

	COZY BOOKSTORE Departmental Expense AllocationSpreadsheet Expense Totals Advertising Purchasing Books Magazines Newspapers Total department expenses $578,000 $57,800 $57,800 $138,700 $115,600 $208,100 Service Dept. Expenses Advertising Dept. Purchasing Dept. Total expensesallocated $578,000