ANSWER:
1. Total cost charged
Auto Division= fixed cost +variable cost = (86000*66%)+(63000*.050)
=88260
Truck division=fixed costs+variable costs = (88000*34%)+(63000*.050)
= 60740
2. Total cost allocated
Auto Division =( (actual fixed costs)+(actual variable costs))/2
= (95000+76000)/2 = 85500
Truck Division =( (actual fixed costs)+(actual variable costs))/2
= (95000+76000)/2 = 85500
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