Question

The following cost data pertain to the operations of Montgomery Department Stores, Inc., for the month of July. Corporate legal office salaries $60,600 Apparel Department cost of sales—Evenda1e Store 116,100Corporate headquarters building lease 56,400Store manager' s salary—Evenda1e Store 18,300Apparel Department sales commission—Evenda1e Store 7,950Store utilities—Evenda1e Store 17,800Apparel manager' s salary—EvendaIe Store 9,950Central warehouse lease cost 24,000Janitorial costs—EvendaIe Store 13,700 The Evendale Store is just one Of many stores owned and operated by the company. The Apparel Department is one of many departments at the Evendale Store. The central warehouse serves all of the company's stores. Required: a. What is the total amount of the costs listed above that are direct costs of the Apparel Department? b. What is the total amount of the costs listed above that are direct costs of the Evendale Store? c. What is the total amount of the Apparel Department's direct costs that are also variable costs with respect to total departmental sales?

Answer 1

1.$134,000

2.$183,800

3.$124,050

Step-by-step explanation:

1. Computation for the total amount of the costs that are direct costs of the Apparel Department

Apparel Department cost of sales - Evendale store $116,100

Apparel Department sales commission-Evendale store $7,950

Apparel Department manager's salary-Evendale store $9,950

Total direct costs for the Apparel Department

$134,000

2. Computation for the total amount of the costs that are direct costs of the Evendale Store

Apparel Department cost of sales - Evendale store $116,100

Store managers salary - Evendale store $18,300

Apparel Department sales commission-Evendale store $7,950

Store utilities - Evendale store $17,800

Janitorial costs - Evendale store $13,700

Apparel Department manager's salary-Evendale store $9,950

Total direct cost for the Evendale store $183,800

3. Computation for the total amount of the Apparel Department's direct costs that are variable costs with respect to total departmental sales

Apparel Department cost of sales - Evendale store $116,100

Apparel Department sales commission-Evendale store $7,950

Total variable cost-Apparel department $124,050