Sheinberg Corporation Has Two Operating Divisions--A Consumer Division and a Commercial

question 42

Multiple Choice

Sheinberg Corporation has two operating divisions--a Consumer Division and a Commercial Division. The company's Order Fulfillment Department provides services to both divisions. The variable costs of the Order Fulfillment Department are budgeted at $73 per order. The Order Fulfillment Department's fixed costs are budgeted at $425,000 for the year. The fixed costs of the Order Fulfillment Department are budgeted based on the peak-period orders.

At the end of the year, actual Order Fulfillment Department variable costs totaled $635,485 and fixed costs totaled $443,380. The Consumer Division had a total of 2,340 orders and the Commercial Division had a total of 6,190 orders for the year.
-How much actual Order Fulfillment Department cost should not be allocated to the operating divisions at the end of the year?

• A)$31,175
• B)$18,380
• C)$12,795
• D)$0

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