Carson Corporation Carson Corporation Has Three Production Departments A, B

question 28

Multiple Choice

Carson Corporation Carson Corporation has three production departments A, B, and C. Carson Corporation also has two service departments, Administration and Personnel. Administration costs are allocated based on value of assets employed, and Personnel costs are allocated based on number of employees. Assume that Administration provides more service to the other departments than does the Personnel Department.
Refer to Carson Corporation. Using the step method, what amount of Administration costs is allocated to Personnel (round to the nearest dollar) ?

• A) $72,973
• B) $291,892
• C) $145,946
• D) $389,189

---

Definitions:

Aggregate Expenditure

Total spending on final goods and services in an economy during a given period, usually a year.

Net National Product

The total value of goods and services produced by a country's citizens, adjusted for depreciation; it reflects the nation's overall economic productivity after wear and tear on assets.

Profit-maximizing Condition

The state or point at which a business achieves the highest level of profit with the least amount of cost, often by equating marginal cost and marginal revenue.

Role Of Government

The activities undertaken by a government to regulate and guide the economy, including policy-making, taxation, and spending.