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Question
Baker Corporation has two operating departments, Machining and Assembly, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period:
| Office Expenses | Total | Allocation Basis | |
| Salaries.................... | $30,000 | Number of employees | |
| Depreciation............ | 20,000 | Cost of goods sold | |
| Advertising.............. | 40,000 | Net sales | |
| Item | Machining | Assembly | Total |
| Number of employees | 1,000 | 1,500 | 2,500 |
| Net sales................... | $325,000 | $475,000 | $800,000 |
| Cost of goods sold.... | $ 75,000 | $125,000 | $200,000 |
The amount of the total office expenses that should be allocated to Assembly for the current period is:
A. $ 35,750.
B. $ 45,000.
C. $ 54,250.
D. $ 90,000.
E. $600,000.
Answer
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