Expo manufacturing has two production departments and two support departments. The number of employees for each department is as follows: Accounting department costs are allocated on the basis of the number of employees. If the budget for accounting costs is $98,000, what amount would be allocated to Machining using the direct method?

Question

Expo manufacturing has two production departments and two support departments. The number of employees for each department is as follows:  Accounting department costs are allocated on the basis of the number of employees. If the budget for accounting costs is $98,000, what amount would be allocated to Machining using the direct method?

Quizplus · Accepted Answer

520 + 220 = 740 
520 ÷ 740 x $98,000 = $68,865 
Mach empl + Assm emply = total empl 
Mach empl ÷ total empl x acct costs = alloc costs

Expo Manufacturing Has Two Production Departments and Two Support Departments