Questions:
1. Which of the following bases can be used to allocate supervisors' salaries across operating departments? (a) Hours spent in each department, (b) number of employees in each department, (c) sales achieved in each department, or (d) any of the above, depending on which information is most relevant and accessible.
2. What three steps are used to allocate expenses to operating departments?
3. An income statement showing departmental contribution to overhead, (a) subtracts indirect expenses from each department's revenues, (b) subtracts only direct expenses from each department's revenues, or (c) shows net income for each department.