Ask Question
25 March, 01:30

Mervon Company has two operating departments: mixing and bottling. Mixing occupies 24,360 square feet. Bottling occupies 16,240 square feet. Indirect factory costs include maintenance costs of $216,000. If the maintenance costs are allocated to operating departments based on square footage occupied, determine the amount of maintenance costs allocated to each operating department.

+3
Answers (1)
  1. 25 March, 01:50
    0
    Allocated costs:

    Mixing = $129,600

    Bottling = $86,400

    Explanation:

    Giving the following information:

    Mervon Company has two operating departments: mixing and bottling. Mixing occupies 24,360 square feet. Bottling occupies 16,240 square feet. Indirect factory costs include maintenance costs of $216,000. The maintenance costs are allocated to operating departments based on square footage occupied.

    Total square feet = 24,360 + 16,240 = 40,600

    Average square feet:

    Mixing = 24,360/40,600 = 0.6

    Bottling = 0.4

    Allocated costs:

    Mixing = 0.6*216,000 = $129,600

    Bottling = 0.4*216,000 = $86,400
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Mervon Company has two operating departments: mixing and bottling. Mixing occupies 24,360 square feet. Bottling occupies 16,240 square ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers