Question :
81. A company rents a building with a total of 100,000 : 1225569
81. A company rents a building with a total of 100,000 square feet, which are evenly divided between two floors. The space on the first floor is considered twice as valuable as that on the second floor. The total monthly rent for the building is $30,000. How much of the monthly rental expense should be allocated to a department that occupies 10,000 square feet on the first floor?
A. $6,000.
B. $5,000.
C. $3,000.
D. $4,000.
E. $2,000.
82. A company pays $15,000 per period to rent a small building that has 10,000 square feet of space. This cost is allocated to the company’s three departments on the basis of the amount and value of the space occupied by each. Department One occupies 2,000 square feet of ground-floor space, Department Two occupies 3,000 square feet of ground-floor space, and Department Three occupies 5,000 square feet of second-floor space. If rents for comparable floor space in the neighborhood average $2.20 per square foot for ground-floor space and $1.10 per square foot for second-floor space and the rent is allocated based on the total value of the space, Department One should be charged rent expense for the period of:
A. $4,400.
B. $4,000.
C. $3,000.
D. $2,200.
E. $2,000.
83. Able Company has two operating (production) departments: Assembly and Fabricating. Assembly has 150 employees and occupies 44,000 square feet; Fabricating has 100 employees and occupies 36,000 square feet. Indirect factory expenses for the current period are as follows:
Administration is allocated based on workers in each department; maintenance is allocated based on square footage. The total amount of indirect factory expenses that should be allocated to the Assembly Department for the current period is:
A. $48,000.
B. $55,000.
C. $103,000.
D. $104,000.
E. $110,000.
84. Wilson Trade School allocates administrative costs to its respective departments based on the number of students enrolled, while maintenance and utilities are allocated per square feet of the classrooms. Based on the information below, what is the total amount allocated to the Automotive Department (rounded to the nearest dollar) if administrative costs for the school were $50,000, maintenance fees were $12,000, and utilities were $6,000?
A. $0.
B. $17,000.
C. $18,500.
D. $22,667.
E. $30,000.
85. White Company has two service departments and two operating (production) departments. The Payroll Department services all three of the other departments in proportion to the number of employees in each. The Maintenance Department costs are allocated to the two operating departments in proportion to the floor space used by each. Listed below are the operating data for the current period:
The total cost of operating the Milling Department for the current period is:
A. $14,280.
B. $15,912.
C. $76,500.
D. $90,780.
E. $92,412.
86. Farber, Inc., has four departments. The Administrative Department costs are allocated to the other three departments based on the number of employees in each and the Maintenance Department costs are allocated to the Assembly and Packaging Departments based on their occupied space. Data for these departments follows:
The total amount of the Administrative Department’s cost that would eventually be allocated to the Packaging Department is:
A. $4,800.
B. $12,000.
C. $10,000.
D. $18,000.
E. $13,000.
87. Mace Department store allocates its service department expenses to its various operating (sales) departments. The following data is available:
The following information is available for its three operating (sales) departments:
What is the total expense allocated to Department B?
A. $29,375.
B. $30,462.
C. $30,500.
D. $30,775.
E. $32,160.
88. Activity based costing can be applied to:
A. Manufacturing activities only.
B. Service activities only.
C. Merchandising activities only.
D. Any company in any industry.
E. Government only.
89. A system of assigning costs to departments and products on the basis of a variety of activities instead of only one allocation base is called:
A. A responsibility accounting system.
B. A cost center accounting system.
C. Controllable costing.
D. Activity-based costing.
E. Performance costing.
90. A factor that causes the cost of an activity to go up or down is a(n):
A. Direct factor.
B. Indirect factor.
C. Cost driver.
D. Product cost.
E. Contribution factor.
