Answer the following questions using the information below:
Stark Corporation has two departments, Car Rental and Truck Rental. Central costs may be allocated to the two departments in various ways.
$\begin{array}{lrr}&\text { Car Rental }&\text { Truck Rental }\
\text { Number of Vehicles in fleet } & 850 & 430 \
\text { Number of employees } & 125 & 75 \
\text { Sales } & \$ 750,000 & \$ 375,000
\end{array}$
-If the facility lease expense of $384,000 is allocated on the basis of vehicles in the fleet,the amount allocated to the Car Rental Department would be ________.
A) $249,000
B) $255,000
C) $267,000
D) $261,000

Question

Answer the following questions using the information below:
Stark Corporation has two departments, Car Rental and Truck Rental. Central costs may be allocated to the two departments in various ways.
 $\begin{array}{lrr}&\text { Car Rental }&\text { Truck Rental }\
\text { Number of Vehicles in fleet } & 850 & 430 \
\text { Number of employees } & 125 & 75 \
\text { Sales } & \$ 750,000 & \$ 375,000
\end{array}$
-If the facility lease expense of $384,000 is allocated on the basis of vehicles in the fleet,the amount allocated to the Car Rental Department would be ________.
A) $249,000
B) $255,000
C) $267,000
D) $261,000

Quizplus · Accepted Answer

The allocation is based on the number of vehicles. Car Rental has 850 out of a total of 1280 vehicles (850 + 430). The allocation is $ \frac{850}{1280} \times 384,000 = 255,000 $.

Answer the Following Questions Using the Information Below: Stark Corporation

Answer the Following Questions Using the Information Below:
Stark Corporation