CakeCo, Inc A) $400
B) $6,000

question 113

Multiple Choice

CakeCo, Inc. has three operating departments. Information about these departments is listed below. Maintenance is service department at CakeCo that incurred $12,000 of costs during the period. If allocated maintenance cost is based on floor space occupied by each of the operating departments, compute the amount of maintenance cost allocated to the Baking Department. $\begin{array} { | l | r | r | r | } \hline & \text { Mixing } & \text { Baking } & \text { Packaging } \\\hline \text { Direct costs } & \$ 21,000 & \$ 15,000 & \$ 9,000 \\\hline \text { Sq ft of space } & 1,000 & 1,500 & 500 \\\hline\end{array}$

• A) $400.
• B) $6,000.
• C) $7,500.
• D) $1,200.
• E) $4,000.

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Definitions:

Arbitration Clause

A provision in a contract that requires the parties to resolve disputes through arbitration rather than through the court system.

Enforceable

Capable of being imposed or brought into effect legally, typically referring to contracts, agreements, or laws.

Offer

A proposal presented by one party to another with the intention to create a legally binding agreement upon acceptance.

Escrow Account

An escrow account is a financial arrangement where a third party holds and regulates payment of the funds required for two parties involved in a given transaction, ensuring fair and secure dealings.