Question

A company has two departments, Y and Z that incur wage expenses. An analysis of the total wage expense of $24,000 indicates that Dept. Y had a direct wage expense of $3,000 and Dept. Z had a direct wage expense of $5,000. The remaining expenses are indirect and analysis indicates they should be allocated evenly between the two departments. Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:

Answer 1

$11,000;$13,000

Step-by-step explanation:

Calculation for Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:

First step is to calculate the Indirect wages

Indirect wages = 24,000 - (3000+5000)

Indirect wages= 16,000

Now let calculate Departmental wage expenses for Dept. Y and Dept. Z, respectively,

Departmental wages for dept Y

= 3000 + (16,000/2)

Departmental wages for dept Y=$ 11,000

Departmental wages for dept Z

= 5000 + (16,000/2)

Departmental wages for dept Z= $13,000

Therefore Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:$11,000 ; $13,000