Question

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 $80,000, maintenance fees were $15,000, and utilities were $7,500? (Do not round your intermediate calculation.)

Department	Students			Classrooms
Electrical		150			11,500		sq. ft.
Welding		85			13,500		sq. ft.
Accounting		65			9,500		sq. ft.
Carpentry		55			7,500		sq. ft.
Total		355			42,000		sq. ft.

Multiple Choice

• $14,648.

• $27,200.

• $28,700.

• $36,635.

• $18,095.

Answer 1

STEP 1: FIND ADMINISTRATIVE COST PER STUDENT

Administrative cost is allocated on the basis of number of students

Total administrative cost = $80,000

Total number of students = 355

Administrative cost per student = Total administrative cost/ Total number of students

=$80,000/355

=$225.35

STEP :2 ALLOCATE COST TO ACCOUNTING DEPARTMENT

Now,we will allocate it to accounting department which have 65 students

The total amount of administrative cost to the Accounting Department =Admisnitrative cost per student*student in accounting department

$225.35*65

=$14,648