Question

Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...

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 $ 45,000 Number of employees
Depreciation 31,000 Cost of goods sold
Advertising 65,000 Net sales
Item Drilling Grinding Total
Number of employees 1,000 1,500 2,500
Net sales $ 376,000 $ 564,000 $ 940,000
Cost of goods sold $ 129,200 $ 210,800 $ 340,000

The amount of depreciation that should be allocated to Drilling for the current period is:
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Cost of goods sold of Drilling = $129,200

Total cost of goods sold = $340,000

Depreciation expense = $31,000

Depreciation expense to be allocated to Drilling = Depreciation expense x Cost of goods sold of Drilling/Total cost of goods sold

= 31,000 x 129,200/340,000

= $11,780

The amount of depreciation that should be allocated to Drilling for the current period is = $11,780

Please give a positive rating if you are satisfied with this solution and if you have any query kindly ask.Thanks!!!

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...
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...
BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International....
BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees, and Accounting costs are allocated on the basis of number of transactions. A summary of BluStar operations follows. Administration Accounting Domestic International Employees – 24 44 32 Transactions 32,000 – 24,000 96,000 Department direct costs $ 354,000 $ 148,000 $ 940,000 $ 3,710,000 Required: a. Allocate the cost of the service departments to the operating...
BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International....
BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees, and Accounting costs are allocated on the basis of number of transactions. A summary of BluStar operations follows. Administration Accounting Domestic International Employees – 24 44 32 Transactions 32,000 – 24,000 96,000 Department direct costs $ 354,000 $ 148,000 $ 940,000 $ 3,710,000 Required: a. Allocate the cost of the service departments to the operating...
Williams Company began operations in January 2017 with two operating (selling) departments and one service (office)...
Williams Company began operations in January 2017 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2017 Clock Mirror Combined Sales $ 140,000 $ 85,000 $ 225,000 Cost of goods sold 68,600 52,700 121,300 Gross profit 71,400 32,300 103,700 Direct expenses Sales salaries 21,500 7,700 29,200 Advertising 1,100 900 2,000 Store supplies used 950 600 1,550 Depreciation—Equipment 2,100 800 2,900 Total direct expenses 25,650...
Williams Company began operations in January 2017 with two operating (selling) departments and one service (office)...
Williams Company began operations in January 2017 with two operating (selling) departments and one service (office) department. Its departmental income statements follow. WILLIAMS COMPANY Departmental Income Statements For Year Ended December 31, 2017 Clock Mirror Combined Sales $ 170,000 $ 115,000 $ 285,000 Cost of goods sold 83,300 71,300 154,600 Gross profit 86,700 43,700 130,400 Direct expenses Sales salaries 22,500 8,000 30,500 Advertising 1,700 700 2,400 Store supplies used 950 250 1,200 Depreciation—Equipment 2,100 400 2,500 Total direct expenses 27,250...
Brownley Company has two service departments and two operating (production) departments. The Payroll Department services all...
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 $ 21,600 $ 28,500 $ 82,500 $ 117,400 No. of...
Av-Y6 Company operates three service departments, administration, maintenance, and personnel and two production departments, assembly and...
Av-Y6 Company operates three service departments, administration, maintenance, and personnel and two production departments, assembly and packaging. Information for the three service departments is given below: Admin Maint Person Directly traced overhead $65,000 $33,000 $74,000 Square feet occupied 2,000 3,500 3,000 Number of employees 42 24 30 Maintenance hours 2,500 2,000 4,000 Information for the two production departments is given below: Assembly Packaging Directly traced overhead $167,030 $114,090 Square feet occupied 2,100 1,400 Number of employees 36 18 Maintenance hours...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits and Loans). A summary of costs and other data for each department prior to allocation of service department costs for the year ended December 31 follows. Administration Communications Facilities Deposits Loans Direct costs $ 200,000 $ 330,000 $ 256,000 $ 7,520,000 $ 4,900,000 Employee hours 22,000 38,000 22,000 436,000 381,000 Number of employees 6 13 4 210 150 Square footage occupied 5,300 12,700 5,700...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits and Loans). A summary of costs and other data for each department prior to allocation of service department costs for the year ended December 31 follows. Administration Communications Facilities Deposits Loans Direct costs $ 170,000 $ 310,000 $ 250,000 $ 7,860,000 $ 4,700,000 Employee hours 28,500 33,000 21,000 478,000 381,000 Number of employees 7 17 8 220 170 Square footage occupied 4,700 13,500 5,200...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits...
State Financial Corp. has three service departments (Administration, Communications, and Facilities), and two production departments (Deposits and Loans). A summary of costs and other data for each department prior to allocation of service department costs for the year ended December 31 follows: Administration Communications Facilities Deposits Loans Direct costs $ 200,000 $ 300,000 $ 254,000 $ 8,000,000 $ 5,000,000 Employee-hours 24,800 33,600 21,600 450,000 350,000 Number of employees 9 15 6 210 150 Square footage occupied 4,900 13,440 5,600 246,400...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT