A company incurred $40,000 of common fixed costs and $60,000 of common variable costs. These costs are to be allocated to Departments A and B. Data on capacity provided and capacity used are as follows:
Assume that common fixed costs are to be allocated to Departments A and B on the basis of capacity provided and that common variable costs are to be allocated to Departments A and B on the basis of capacity used. The fixed and variable costs allocated to Department A are
A) $20,000 $37,500
B) $20,000 $30,000
C) $25,000 $30,000
D) $25,000 $37,500
Correct Answer:
Verified
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