The following is a partially completed lower section of a departmental expense allocation spreadsheet for Stoneham. It reports the total amounts of direct and indirect expenses for the four departments. Purchasing department expenses are allocated to the operating departments on the basis of purchase orders. Maintenance department expenses are allocated based on square footage. Compute the amount of Purchasing department expense to be allocated to Fabrication.
Purchasing Maintenance Fabrication Assembly
Operating costs $36,000 $20,400 $100,000 $66,000
No. of purchase orders 15 5
Sq.ft. of space 3,500 2,500
a. $11,900.
b. $19,800.
c. $8,500.
d. $27,000.
e. $9,000.