Use the information to answer question below ......................... Departments ........................... P Q R Sales value...............
Use the information to answer question below
......................... Departments
........................... P Q R
Sales value............... N23,400
Selling expenses.......... 1,100 N1,400 N1,280
Administrative expenses...N1,400 N1,000 N1,020
Cost of sales............. N6,900.... N6,700 N5,500
Sales value of department Q doubles that of p, which is 1/3 of R. Depreciation which amounts to N1,800 is to be apportioned among the three departments in the ratio 3:5:7 respectively.
Determine the total expenses of department P?
- A. 9,760
- B. 9,400
- C. 2,860
- D. 2,500
Correct Answer: C. 2,860
Explanation
Depreciation is considered an operating expense so it will be added to the expenses.
Total expense of P = Selling expenses + Administrative expenses + depreciation
1100 + 1400 + \(\frac{3}{15}\) x 1800
1100 + 1400 + 360 = 2,860