Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...

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Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of...

Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period:

Office Expenses	Total		Allocation Basis
Salaries	$	34,000	Number of employees
Depreciation		22,000	Cost of goods sold
Advertising		46,000	Net sales

Item	Drilling		Grinding		Total
Number of employees		1,320		1,980		3,300
Net sales	$	331,500	$	484,500	$	816,000
Cost of goods sold	$	81,000	$	135,000	$	216,000

The amount of the total office expenses that should be allocated to Grinding for the current period is (Do not round your intermediate calculations.)

Multiple Choice

$40,563.
$49,813.
$61,463.
$102,000.
$600,000

business accounting

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Answer 1

Answer #1

The amount of the total office expenses that should be allocated to Grinding for the current period

= Salaries (34,000/3300)*1980 + Depreciation (22,000/216,000)*135,000 + Advertising (46,000/816,000)*484,500

= 61,463

Option C is the answer

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Answer 2

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