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E12-29 ( similar to ) p . 483
The city of Seattle signed a lease for a photocopy machine at $ 3,200 per month and $ 0.02 per copy . Operating costs for toner , paper , operator salary , and so on are all variable at $ 0.03 per copy . Departments had projected a need for 105,000 copies a month . The city planning department predicted its usage at 34,000 copies a month . It made 41,000 copies in August .
Requirement 1 . Suppose one predetermined rate per copy was used to allocate all photocopy costs . What rate would be used and how much cost would be allocated to the city planning department in August ? ( Round your answer to three decimal places .)
Requirement 2 . Suppose fixed- and variable-cost pools were allocated separately . Specify how each pool should be allocated . Compute the cost allocated to the city planning department in August .
Requirement 3 . Which method , the one in number 1 or the one in number 2 , do you prefer ? Explain .
E12-32 ( similar to ) p . 487