Apex Company\'s copy department, which does almost all the photocopying for the

Question

Apex Company's copy department, which does almost all the photocopying for the sales dept and the adm dept, budgets the the following costs for the year, based on the expected activity of 5,000,000 copies: salaries (fixed) $80,000 Employee benefits (fixed) 10,000 depreciation of copy machines (fixed) 10.000 utilities (fixed) 5,000 Paper (variable, 1 cent per copy) 50,000 Toner (variable, 1 cent per copy) 50,000 The cost are assigned to two cost pools, one for fixed and one for vatiable cost. The cost are then assigned to the sales dept and the admin dept. Fixed cost are assigned on a lump sum basis, 40 percent to sales and 60 percent to adm. The variable cost are assigned at a rate of 2 cents per copy/ *** Assume 4,800,000 copies were made durning the year 2,500,000 for sales and 2,300,000 for adm, calaulate the copy department cost allocated to sales and administration.

Explanation / Answer

Fixed costs: Salaries: $ 80,000 Emp Ben: $10,000 Dep: $10,000 Utilities: $5,000 total Fixed cost= $105,000: Sales==> $42,000. Admin==>$63,000 veriable cost; Sales:2,500,000*2/100=$50,000: Admin==>2,300,000*2/100=$46,000 Total: Sales=$92,000 Admin=$109,000

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.