Woh Che Co. has four departments: materials, personnel, manufacturing, and packaging. In a recent month, the four departments incurred three shared indirect expenses. The amounts of these indirect expenses and the bases used to allocate them follow. Indirect Expense Cost Allocation Base
Supervision $82,500 Number of employees
Utilities 50,000 Square feet occupied
Insurance 22,500 Value of assets in use
TOtal $155,000
Departmental data for the company's recent reporting period follow.
Department Employees Square Feet Asset Values
Materials 27 25,000 $6,000
Personnel 9 5,000 1,200
Manufacturing 63 55,000 37,800
Packaging 51 15,000 15,000
Total 150 100,000 $60,000
1. Use this information allocate each of three indirect expenses across the four departments.
2. Prepare summary table tha reports the indirect expenses assigned to each of the four departments.