Asked by Rainn Cline on Jul 12, 2024
Verified
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.
Maintenance Expenses
Costs incurred in the upkeep of property or equipment to ensure its continued functionality and efficiency.
Square Footage
The measurement of area expressed in square feet, commonly used to determine the size of a building or room.
- Implement allocation of expenses for office and departmental costs.
- Implement principles of expense allocation in particular scenarios covering rent, administrative costs, and indirect factory expenses.
Verified Answer
TB
tasha brooksJul 14, 2024
Final Answer :
B
Explanation :
Maintenance expenses are allocated based on square footage, so we need to calculate the allocation rate per square foot.
Total maintenance expenses = $480,000 + $240,000 = $720,000
Total square footage = 44,000 + 36,000 = 80,000
Allocation rate per square foot = $720,000 / 80,000 = $9
To allocate maintenance expenses to the Assembly Department, we need to multiply the allocation rate by the square footage of the department:
Maintenance expenses for Assembly Department = $9 per square foot x 44,000 square feet = $396,000
Therefore, the amount of maintenance expenses that should be allocated to the Assembly Department for the current period is $55,000 (choice B).
Total maintenance expenses = $480,000 + $240,000 = $720,000
Total square footage = 44,000 + 36,000 = 80,000
Allocation rate per square foot = $720,000 / 80,000 = $9
To allocate maintenance expenses to the Assembly Department, we need to multiply the allocation rate by the square footage of the department:
Maintenance expenses for Assembly Department = $9 per square foot x 44,000 square feet = $396,000
Therefore, the amount of maintenance expenses that should be allocated to the Assembly Department for the current period is $55,000 (choice B).
Learning Objectives
- Implement allocation of expenses for office and departmental costs.
- Implement principles of expense allocation in particular scenarios covering rent, administrative costs, and indirect factory expenses.
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