The Lots More Store Has a Janitorial Department and a Personnel

question 70

Multiple Choice

The Lots More Store has a Janitorial Department and a Personnel Department that provide services to three Sales Departments. The Janitorial Department cost is allocated based on space and the Personnel Department cost is allocated because of employees. The following information is available.
Using the step-down method, calculate the amount of Personnel Department cost allocated to Sales Department #3, if the Personnel Department is allocated first.

• A) $13 500
• B) $12 857
• C) $12 000
• D) $15 000

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Definitions:

Commission Charges

Fees paid to brokers or agents for their services in facilitating transactions, typically a percentage of the transaction value.

Dividend

The number being divided.

Rate of Yield

A financial ratio that measures the annual return on an investment expressed as a percentage.

Commission Charges

Fees that are paid to an agent or company for facilitating a transaction, often calculated as a percentage of the transaction value.