The Printing Department Supplies Copy and Printing Support for Both

question 48

Multiple Choice

The printing department supplies copy and printing support for both Departments A and B and has prepared its total budget using the following information for next year: $$\begin{array} { l c } \text { Fixed costs } & \$ 100,000 \\\text { Available capacity } & 4,000,000 \text { pages } \\\text { Budgeted usage: } & \\\quad \text { Department A } & 1,200,000 \text { pages } \\\quad \text { Department B } & 2,400,000 \text { pages } \\\text { Variable cost } & \$ 0.03 \text { perpage }\end{array}$$ Assume that the single rate method of cost allocation is used and the allocation base is budgeted usage. How much photocopying cost will be allocated to Department B using budgeted costs and usage?

• A) $72,000
• B) $122,000
• C) $132,000
• D) $138,667

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