The following is a partially completed departmental expense allocation spreadshe

Question

The following is a partially completed departmental expense allocation spreadsheet for Brickland. It reports the total amounts of direct and indirect expenses for it's four departments. Purchasing department expenses are allocated to the operating departments on the basis of purchase orders. Maintenance department expenses are allocated based on square footage. Compute the amount of Maintenance department expense to be allocated to Fabrication. (Do not round your intermediate calculations).

Operating costs:

Purchasing $45,000, Maintenence $25,800, Fabrication $109,000, Assembly $75,000.

No. of purchase orders: 15 for Fabrication and 5 for Assembly.

Sq ft. of space: 3,950 for Fabrication and 2,050 for Assembly.

A. $33,750

B. $11,250

C. $8,815

D. $16,985

Explanation / Answer

Compute the amount of Maintenance department expense to be allocated to Fabrication.

Maintenance department expense to be allocated to fabrication = 25800*3950/6000 = 16985

so answer is d) 16985

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