Use the Following Information for the Next 6 Questions

question 106

Multiple Choice

Use the following information for the next 6 questions.
The accountant for Milton, Inc. is preparing the budgets for operating department support service costs. Maintenance costs are allocated based on square feet, and cafeteria costs are allocated based on number of employees. The following data have been collected:
-If the direct method is used, maintenance costs allocated to the cutting department will be

• A) $15,909
• B) $23,333.33
• C) $20,520
• D) $43,750

Recognize the practical preferences and limitations of IRR and NPV in managerial decision-making.

Understand the principles behind facility location selection and the factor rating method.

Apply quantitative methods to determine optimal facility locations.

Analyze the costs and benefits associated with various location options.

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Definitions:

§179 Expense

A section of the U.S. tax code that allows businesses to deduct the full purchase price of qualifying equipment and/or software within a tax year.

Machinery

Mechanical devices or equipment designed to perform a specific task in industrial, commercial, or agricultural applications.

§179 Expense

A tax code allowing businesses to deduct the full purchase price of qualifying equipment or software within the tax year of purchase.

Cost Recovery Deduction

A tax deduction that allows taxpayers to recover the cost of an investment over time through depreciation.