Marathon Running Shop has two service departments (advertising and administrative) and two
Marathon Running Shop has two service departments (advertising and administrative) and two operating departments (shoes and clothing). During 2015, the departments had the following direct expenses and occupied the following amount of floor space Direct Department Square Feet Expenses Advertising 16,000 900 29,000 Administrative 500 3,400 Shoes 110,000 Clothing 14,000 5,200 The advertising department developed and distributed 120 advertisements during the year Of these, 12 promoted shoes and 108 promoted clothing. The store sold $240,000 of merchandise during the year. Of this amount, $139,200 is from the shoes department, and $100,800 is from the clothing department. The utilities expense of $71,000 is an indirect expense to all departments Complete a departmental expense allocation spreadsheet for Marathon Running Shop. The spreadsheet should assign (1) direct expenses to each of the four departments, (2) the $71,000 of utilities expense to the four departments on the basis of floor space occupied, (3) the advertising department's expenses to the two operating departments on the basis of the number of ads placed that promoted a department's products, and (4) the administrative department's expenses to the two operating departments based on the amount of sales.