Exercise 12-37 Alternative Allocation Bases (LO 12-6) Thompson Aeronautics repairs aircraft engines. The company's Purchasing Department supports its two departments Defense and Commercial. The Defense division has contracts with the Department of Defense and the Commercial division works primarily with domestic airlines and air freight companies. The cost of the Purchasing Department is $7.80 million annually. Information on the activity of the Purchasing Department for the last year follows: Defense Commercial Orders 9,200 36,800 $124,000,000 186,000,000