Keegan CoHas Four Departments:
Purchasing,human Resources,manufacturing,and Assembly Departmental Data for the Company's Recent Reporting Period Follow

question 131

Essay

Keegan Co.has four departments:
purchasing,human resources,manufacturing,and assembly.In a recent month the four departments incurred two shared indirect expenses.The amounts of the indirect expenses and the bases used to allocate them follow.(1)Use this information to allocate each of the two indirect expenses across the four departments using the tables provided below.
$$\begin{array} { | l | r | l | } \hline \text { Indirect Expense } & \text { Cost } & \text { Allocation Base } \\\hline \text { Supervision } & \$ 85,000 & \text { Number of employees } \\\hline \text { Utilities and Insurance } & \underline { 38,000 } & \text { Square feet occupied } \\\hline \text { Total } & \underline { 123,000 } & \\\hline\end{array}$$ Departmental data for the company's recent reporting period follow.
$$\begin{array} { | l | l | l | l | } \hline \text { Pepartrent } & & & \\\hline \text { Purchasing } & & & \\\hline \text { Human Resources } & & & \\\hline \text { Manufacturing } & & & \\\hline \text { Assermbly } & & & \\\hline \text { Total } & & & \\\hline\end{array}$$

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Definitions:

Statement of Stockholders' Equity

A financial document showing changes in the value of a company’s equity over a specific period, including shares issued, dividends paid, and earnings retained.

Retained Earnings

The residual net income available to a business after distributing dividends to its shareholders.

Net Income

Net income is the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenues.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.