Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

The canteen expenses of a business were allocated to production departments $1$ and $2$. The total canteen expenses allocated to production department $1$ came to $\$40\,200$. Of this amount, $\$3900$ was directly linked to a special function carried out by production department $1$. The balance was shared out according to the number of employees, which were $15$ in production department $1$ and $10$ in production department $2$. What was the total canteen cost for the whole business?

  • A$\$63\,100$
  • B$\$64\,400$
  • C$\$67\,000$
  • D$\$70\,900$

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