91) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of depreciation that should be allocated to Grinding for the current period is:
A) $20,000.
B) $25,000.
C) $7,500.
D) $12,500.
E) $40,000.
92) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of the advertising cost that should be allocated to Grinding for the current period is:
A) $16,250.
B) $45,000.
C) $23,750.
D) $325,000.
E) $54,250.
93) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of the total office expenses that should be allocated to Drilling for the current period
is:
A) $35,750.
B) $45,000.
C) $54,250.
D) $90,000.
E) $600,000.
94) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of salaries that should be allocated to Drilling for the current period is:
A) $30,000.
B) $18,000.
C) $15,000.
D) $10,000.
E) $12,000.
95) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of depreciation that should be allocated to Drilling for the current period is:
A) $20,000.
B) $25,000.
C) $7,500.
D) $12,500.
E) $40,000.
96) Marks Corporation has two operating departments, Drilling and Grinding, and an office. The
three categories of office expenses are allocated to the two departments using different allocation
bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 30,000 Number of employees
Depreciation 20,000 Cost of goods sold
Advertising 40,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 325,000 $ 475,000 $ 800,000
Cost of goods sold $ 75,000 $ 125,000 $ 200,000
The amount of the advertising cost that should be allocated to Drilling for the current period is:
A) $16,250.
B) $45,000.
C) $23,750.
D) $325,000.
E) $54,250.
97) In a firm that manufactures clothing, the department that is responsible for actually
assembling the garments could best be described as a(n):
A) Service department.
B) Operating or production department.
C) Cost center.
D) Department in which all of the costs incurred are direct expenses.
E) Department in which all of the costs incurred are indirect expenses.
98) A company rents a building with a total of 50,000 square feet, which are evenly divided
between two floors. The company allocates the rent for space on the first floor at twice the rate
of space on the second floor. The total monthly rent for the building is $30,000. How much of
the monthly rental expense should be allocated to a department that occupies 10,000 square feet
on the first floor?
A) $8,000.
B) $5,000.
C) $3,000.
D) $4,000.
E) $2,000.
99) A company rents a building with a total of 50,000 square feet, which are evenly divided
between two floors. The company allocates the rent for space on the first floor at twice the rate
of space on the second floor. The total monthly rent for the building is $30,000. How much of
the monthly rental expense should be allocated to a department that occupies 10,000 square feet
on the second floor?
A) $8,000.
B) $5,000.
C) $3,000.
D) $4,000.
E) $2,000.
100) A company pays $15,000 per period to rent a small building that has 10,000 square feet of
space. This cost is allocated to the company’s three departments on the basis of the amount of the
space occupied by each. Department One occupies 2,000 square feet of floor space, Department
Two occupies 3,000 square feet of floor space, and Department Three occupies 5,000 square feet
of floor space. If the rent is allocated based on the total square footage of the space, Department
One should be charged rent expense for the period of:
A) $4,400.
B) $3,000.
C) $4,000.
D) $2,200.
E) $2,000.
101) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The total amount of indirect factory expenses that should be allocated to the
Assembly Department for the current period is:
A) $48,000.
B) $55,000.
C) $103,000.
D) $104,000.
E) $110,000.
102) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The amount of administration expenses that should be allocated to the
Assembly Department for the current period is:
A) $48,000.
B) $55,000.
C) $103,000.
D) $104,000.
E) $110,000.
103) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The amount of maintenance expenses that should be allocated to the
Assembly Department for the current period is:
A) $48,000.
B) $ 55,000.
C) $103,000.
D) $104,000.
E) $110,000.
104) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The total amount of indirect factory expenses that should be allocated to the
Painting Department for the current period is:
A) $48,000.
B) $55,000.
C) $77,000.
D) $103,000.
E) $110,000.
105) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The amount of administration expenses that should be allocated to the
Painting Department for the current period is:
A) $48,000.
B) $55,000.
C) $103,000.
D) $32,000.
E) $110,000.
106) Ready Company has two operating (production) departments: Assembly and Painting.
Assembly has 150 employees and occupies 44,000 square feet; Painting has 100 employees and
occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration $ 80,000
Maintenance $ 100,000
Administration is allocated based on workers in each department; maintenance is allocated based
on square footage. The amount of maintenance expenses that should be allocated to the Painting
Department for the current period is:
A) $48,000.
B) $55,000.
C) $103,000.
D) $45,000.
E) $110,000.
107) Canfield Technical School allocates administrative costs to its respective departments based
on the number of students enrolled, while maintenance and utilities are allocated per square feet
of the classrooms. Based on the information below, what is the total amount allocated to the
Welding Department (rounded to the nearest dollar) if administrative costs for the school were
$50,000, maintenance fees were $12,000, and utilities were $6,000?
Department Students Classrooms
Electrical 120 10,000 sq. ft.
Welding 70 12,000 sq. ft.
Accounting 50 8,000 sq. ft.
Carpentry 40 6,000 sq. ft.
Total 280 36,000 sq. ft.
A) $0.
B) $17,000.
C) $18,500.
D) $22,667.
E) $30,000.
108) Canfield Technical School allocates administrative costs to its respective departments based
on the number of students enrolled, while maintenance and utilities are allocated per square feet
of the classrooms. Based on the information below, what is the total amount of administrative
cost to the Accounting Department (rounded to the nearest dollar) if administrative costs for the
school were $50,000, maintenance fees were $12,000, and utilities were $6,000?
Department Students Classrooms
Electrical 120 10,000 sq. ft.
Welding 70 12,000 sq. ft.
Accounting 50 8,000 sq. ft.
Carpentry 40 6,000 sq. ft.
Total 280 36,000 sq. ft.
A) $8,929.
B) $17,000.
C) $18,500.
D) $22,667.
E) $11,111.
109) Canfield Technical School allocates administrative costs to its respective departments based
on the number of students enrolled, while maintenance and utilities are allocated per square feet
of the classrooms. Based on the information below, what is the total amount of maintenance cost
to the Carpentry Department (rounded to the nearest dollar) if administrative costs for the school
were $50,000, maintenance fees were $12,000, and utilities were $6,000?
Department Students Classrooms
Electrical 120 10,000 sq. ft.
Welding 70 12,000 sq. ft.
Accounting 50 8,000 sq. ft.
Carpentry 40 6,000 sq. ft.
Total 280 36,000 sq. ft.
A) $1,714.
B) $12,000.
C) $1,850.
D) $2,000.
E) $1,111.
110) Brownley Company has two service departments and two operating (production)
departments. The Payroll Department services all three of the other departments in proportion to
the number of employees in each. The Maintenance Department costs are allocated to the two
operating departments in proportion to the floor space used by each. Listed below are the
operating data for the current period:
Service Depts. Production Depts.
Payroll Maintenance Milling Assembly
Direct costs $ 20,400 $ 25,500 $ 76,500 $ 105,400
No. of personnel 15 15 45
Sq. ft. of space 10,000 15,000
The total cost of operating the Milling Department for the current period is:
A) $14,280.
B) $15,912.
C) $76,500.
D) $90,780.
E) $92,412.
111) Brownley Company has two service departments and two operating (production)
departments. The Payroll Department services all three of the other departments in proportion to
the number of employees in each. The Maintenance Department costs are allocated to the two
operating departments in proportion to the floor space used by each. Listed below are the
operating data for the current period:
Service Depts. Production Depts.
Payroll Maintenance Cutting Assembly
Direct costs $ 20,400 $ 25,500 $ 76,500 $ 105,400
No. of personnel 15 15 45
Sq. ft. of space 10,000 15,000
The total cost of operating the Maintenance Department for the current period is:
A) $14,280.
B) $15,912.
C) $25,500.
D) $29,580.
E) $22,412.