Lucia Company has two service departments: Office and Purchasing. Total expenses for the Office is $54,100 and for Purchasing is $33,800. Expenses for the Office are allocated to operating departments based on sales. Expenses for Purchasing are allocated to operating departments based on purchase orders.

 Lucia Company has two service departments: Office and Purchasing. Total expenses for the Office is $54,100 and for Purchasing is $33,800. Expenses for the Office are allocated to operating departments based on sales. Expenses for Purchasing are allocated to operating departments based on purchase orders.
 

Department    Sales    Purchase Orders
Books    $ 143,500    1,440
Magazines    70,000    756
Newspapers    136,500    1,404
Total    $ 350,000    3,600
 
Allocate the expenses from (a) the Office and (b) Purchasing to each of the company’s three operating departments using the given information.

 

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