Question

regal furniture company allocates its indirect salaries of $22,500 on the basis of sales. Determine the indirect salaries allocated to Departments 1 and 2 using the following information.

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Answer 1

Answer:

• $15750 and $6750

Step-by-step explanation:

Revenue share of Dept. 1:

• 182000/260000*100% = 70%

Revenue share of Dept. 2:

• 100% - 70% = 30%

Allocate the indirect salary with same ratio.

Dept. 1:

• 22500*70/100 = 15750

Dept. 2:

• 22500 - 15750 = 6750