Chapter 22 Exercises i Saved Help Save & Exit Submit Check my work Required information Part 1 of 2 [The following information applies to the questions displayed below.] National Retail has two departments, Housewares and Sporting. 33.33 Indirect expenses for the period follow. points Rent $ 45, 000 03:35:18 Advertising 25, 000 Insurance 10 , 000 Total $ 80, 000 The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of Book indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect expenses to each department based on the square feet it occupied. Print The company now wants to allocate indirect expenses using the allocation bases shown below. Value of Insured Department Square Feet Sales Assets References Housewares 1, 600 $ 330, 000 $55,00 Sporting 2, 40 170 , 00 45, 000 Total 4, 000 $ 500, 000 $ 100, 000 Required: 1. Allocate indirect expenses to the two departments using the allocation method used in prior periods. Department Square Feet Rate Total Housewares Sporting Mc Graw Prev 1 2 of 3 Next > HillChapter 22 Exercises 0 Slved Help Save a Exit Submit 2 [The following information applies to the questions displayed below. ] National Retail has two departments, Housewares and Sporting, Indirect expenses for the period follow. Part 2 0' 2 - Rent. 5 45,000 Advertising 25,000 33 33 Insurance 10,000 pom Total 5 00,000 The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of indirect expenses by 4,000 square feet to nd an average cost of $20 per square loot, and then allocated indirect expenses to each department based on the square feet it occupied. Q The company now wants to allocate indirect expenses using the allocation bases shown below. eEook Value of Insured Department Square Feet Sales Assets Housewares 1,500 s 330,00n s 55,000 Sporting 2,400 170,000 45,000 Total moon s Samoan s 100.000 Relevances 2. Allocate indirect expenses to the two departments. Rent expense is allocated based on square feet occupied. Advertising expense is allocated based on total sales. Insurance expense is allocated based on the value of insured assets. Allocate 95.000 ol rent using square leet occupied Housewares Sporting Total Allocate 525,000 or advertising using percentage or sales Housewares Sporting Total Allocate $10,000 of insurance using value 07 insured assets Housewares Sporting Total Chapter 22 Exercises i Saved Help Save & Exit Submit Check my work 3 Garcia Company has two operating departments (Phone and Earbuds) and one service department (Office). Its departmental income statements follow. Indirect expenses and service department expenses consist of rent, utilities, and office department expenses. 33.34 GARCIA COMPANY points Departmental Income Statements For Year Ended December 31 Phone Earbuds Combined 03:34:41 Sales $ 240 , 000 $ 115, 000 $ 355, 000 Cost of goods sold 117 , 600 71, 30 188 ,900 Gross profit 122 , 400 13, 700 166, 100 Expenses Sales salaries 22, 000 7, 200 29 , 200 Supplies used 850 400 eBook 1, 250 Depreciation-Equipment 2, 400 500 2,900 Rent 7, 070 3, 840 10,910 Utilities 2 , 400 2, 100 4,500 Print Share of office department expenses 13,000 9, 000 22, 000 Total expenses 47, 720 23, 040 70, 760 Income $ 74, 680 $ 20, 660 $ 95 , 340 References Required: Prepare a departmental contribution to overhead report. Garcia Company Departmental Contribution to Overhead For Year Ended December 31 Phone Earbuds Combined Direct expenses Total direct expenses Departmental contribution to overhead Mc Graw Hill