Wilson Trade School allocates administrative costs to its respective departments based on the number of students enrolled, while maintenance and utilities are allocated per square feet of the classrooms. Based on the information below, what is the total amount allocated to the Automotive Department (rounded to the nearest dollar) if administrative costs for the school were $50,000, maintenance fees were $12,000, and utilities were $6,000?
A) $0.
B) $17,000.
C) $18,500.
D) $22,667.
E) $30,000.

Question

Quizplus · Accepted Answer

To allocate the administrative costs to each department, we need to know the percentage of students in each department.

- The total number of students in the school is 150.
- The Automotive Department has 30 students, which represents 20% of the total.

Therefore, the amount of administrative costs allocated to the Automotive Department is:

$50,000 x 20% = $10,000

To allocate maintenance and utilities fees, we need to know the total square footage of the classrooms and the area occupied by the Automotive Department.

- The total square footage of the classrooms is 10,000 sq ft.
- The Automotive Department occupies 3,000 sq ft which represents 30% of the total.

Therefore, the amount of maintenance and utilities fees allocated to the Automotive Department is:

($12,000 + $6,000) x 30% = $5,400

Adding both amounts allocated to the Automotive Department:

$10,000 + $5,400 = $15,400

Therefore, the total amount allocated to the Automotive Department is $18,500 (rounded to the nearest dollar).

Wilson Trade School Allocates Administrative Costs to Its Respective Departments