The Copy Department in the College of Business at State

question 75

Multiple Choice

The Copy Department in the College of Business at State University provides photocopying services for both the Marketing and Economics Departments. The following budget has been prepared for the year.
$$\begin{array} { l c } \text { Available capacity } & 6,000,000 \text { pages } \\\text { Budgeted usage: } & \\\text { Marketing } & 3,600,000 \text { pages } \\\text { Economics } & 1,800,00 \text { pages } \\\text { Cost equation } & \$ 120,000 + \$ 0.025 \text { per page }\end{array}$$
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If the Copy Department uses a dual rate for allocating its costs based on usage, how much cost will be allocated to the Marketing Department?

• A) $85,000.
• B) $90,000.
• C) $150,000.
• D) $170,000.

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Definitions:

Insolvency

Refers to the financial condition where an entity can not meet its debt obligations as they come due.

Consecutive Years

Years that follow one after another without interruption.

Involuntary Bankruptcy

A legal process initiated by creditors to force a debtor into bankruptcy proceedings, in order to recoup debts owed by liquidating the debtor's assets.

Nonprofit Organizations

Organizations that operate for charitable, educational, cultural, scientific, or social welfare purposes rather than for profit.