The Following Is a Partially Completed Departmental Expense Allocation Spreadsheet

question 25

Multiple Choice

The following is a partially completed departmental expense allocation spreadsheet for Brickland. It reports the total amounts of direct and indirect expenses for its four departments. Purchasing department expenses are allocated to the operating departments on the basis of purchase orders. Maintenance department expenses are allocated based on square footage. Compute the amount of Maintenance department expense to be allocated to Fabrication. $\begin{array}{lcccc}&\text { Purchasing }& \text { Maintenance }&\text { Fabrication }& \text { Assembly }\\ \text { Operating costs } & \$ 32,000 & \$ 18,000 & \$ 96,000 & \$ 62,000 \\\text { No. of purchase orders } && & 16 & 4 \\\text { Sq. ft. of space } & & &3,300 & 2,700\end{array}$

• A) $6,400.
• B) $25,600.
• C) $8,100.
• D) $9,900.
• E) $9,000.

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Definitions:

Remuneration Expense

Costs incurred by an organization to compensate its employees, including salaries, wages, bonuses, and benefits.

Vesting Period

The time period an employee must wait before gaining access to the employer's contributions in a pension plan or stock options.

Incremental Fair Value

The additional amount that a company expects to earn from acquiring a new asset over its current market value.

Vesting Period

The period of time an employee must wait until they have the full right to exercise their stock options or benefits.