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Question
Super Grocery store allocates its service department expenses to its various operating (sales) departments. The following data is available for its service departments:
Expense Basis for allocation Amount
Administrative Square feet of floor space $15,000
Advertising Amount of dollar sales $8,000
The following information is available for its three operating (sales) departments:
Department Square
Feet Dollar
Sales
Produce 1,000 $80,000
Bakery 800 $30,000
Meats 1,200 $42,000
Totals 3,000 $152,000
What is the total administrative expense allocated to the Meats department?
A. $6,000.
B. $9,000.
C. $4,145.
D. $1,200.
E. $3,000.
Answer
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