The Technical Services Department of Wichita State University leased a photocopy machine for $2,000 per month plus $0.04 per copy.Additional budgeted variable operating costs were $0.02 per copy.The Technical Services Department estimated the machine would produce 30,000 copies per month.The Accounting Department estimated is would make 6,000 copies per month but it actually made 4,000 copies.Assume fixed and variable cost pools are allocated separately.What is the amount of fixed cost allocated to the Accounting Department for the month?
A) $200
B) $267
C) $360
D) $400

Question

Quizplus · Accepted Answer

The fixed cost of leasing the photocopy machine is $2,000 per month. Since fixed costs are allocated separately and do not change with the number of copies made, the allocation of fixed costs to any department is based on some predetermined basis, not on actual usage. Without specific information on the allocation basis, it's not possible to directly calculate how much of the fixed cost is allocated to the Accounting Department based on the number of copies made. However, the question seems to imply that the fixed cost allocation is not dependent on the number of copies, so the entire $2,000 is a fixed cost that would be considered in total, not allocated based on usage. Therefore, without a clear allocation method provided, we cannot directly determine the exact amount allocated to the Accounting Department from the information given. The correct answer, based on standard allocation practices, would require more information about how the fixed costs are divided among departments.

The Technical Services Department of Wichita State University Leased a Photocopy