Won Han Co. has four departments: materials, personnel, manufacturing, and packa

Question

Won Han 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.

  

    

    

   

Use this information to allocate each of the three indirect expenses across the four departments. (Round your intermediate and final answers to the nearest whole dollar. Omit the "$" & "%" signs in your response.)

   

   

   

  

Prepare a summary table that reports the indirect expenses assigned to each of the four departments. (Round your intermediate and final answers to the nearest whole dollar. Omit the "$" sign in your response.)

Indirect Expense Cost Allocation Base   Supervision $ 70,000 Number of employees   Utilities 64,000 Square feet occupied   Insurance 17,000 Value of assets in use      Total $ 151,000   

Explanation / Answer

Requirement 1 Allocation of Indirect expenses to Four Departments Supervision expenses Department Employees % of Total      Cost   Materials 18 14.63        10,244   Personnel 8 6.50          4,553   Manufacturing 65 52.85        36,992   Packaging 32 26.02        18,211      Totals 123 100.00        70,000 Utilities expenses Department Square Feet % of Total      Cost   Materials 29000 29.84        19,095   Personnel 4700 4.84          3,095   Manufacturing 50000 51.44        32,922   Packaging 13500 13.89          8,889      Totals 97200 100.00        64,000    Insurance expenses Department Asset Values % of Total      Cost   Materials 34000 38.51          6,546   Personnel 1200 1.36             231   Manufacturing 38300 43.37          7,374   Packaging 14800 16.76          2,849      Totals 88300 100.00        17,000 Requirement 2 Summary table of indirect Expenses assigned to Departments   Supervision     Utilities     Insurance    Total   Materials          10,244     19,095          6,546     35,884   Personnel            4,553       3,095             231       7,879   Manufacturing          36,992     32,922          7,374     77,287   Packaging          18,211       8,889          2,849     29,950      Totals          70,000     64,000        17,000 1,51,000

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