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alexandr402 [8]
3 years ago
6

Calico Company has two operating departments: Department A and Department B. Department A occupies 30% of the floor space of the

company but accounts for 75% of the sales of the company. Department B occupies 70% of the floor space of the company but accounts for 25% of company sales. Cleaning expense (an indirect expense of the company), which consists primarily of vacuuming the carpet is $30,000 each year. How much cleaning expense should be allocated to Department B
Business
1 answer:
Mandarinka [93]3 years ago
6 0

Answer: $21000

Explanation:

Based on the information given in the question, the cleaning expense should be allocated to Department B will be the percentage of floor space occupied by Department B multiplied by the cleaning expense. This will be:

= 70% × $30,000

= 70/100 × $30,000

= 0.7 × $30,000

= $21000

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