Answer the Following Questions Using the Information Below:
the Charmatz

question 17

Multiple Choice

Answer the following questions using the information below:
The Charmatz Corporation has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year:
Budgeted costs of operating the copying facility
$\begin{array}{lll}\text { for } 400,000 \text { to } 600,000 \text { copies: }\\\text { Fixed costs per year }&\$60,000\\\text { Variable costs }&3 \text { cents }(.03) \text { per copy }\\\text { Budgeted long-run usage in copies per year: }\\\text { Marketing Department } & 120,000 & \text { copies } \\\text { Operations Department } & 380,000 & \text { copies }\end{array}$ Budgeted amounts are used to calculate the allocation rates.
Actual usage for the year by the Marketing Department was 80,000 copies and by the Operations Department was 360,000 copies.
-If a single-rate cost-allocation method is used,what amount of copying facility costs will be budgeted for the Marketing Department?

• A) $18,000
• B) $3,600
• C) $14,400
• D) $16,800

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Definitions:

Accumulated Depreciation

The cumulative depreciation expense registered for an asset from the time it was initially utilized.

Commercial Substance

An accounting principle that transactions should result in a real change to the economic circumstances of a company, as opposed to being conducted for appearance's sake.

Invoice Price

The amount shown on an invoice as the price of goods or services, prior to any discounts or adjustments.

Fully Depreciated

Term used for an asset that has reached the end of its useful life, with its cost fully allocated across the accounting periods it was in use.