Adel Department Store incurred $8,000 of indirect advertising costs for its operations. The following 2005

Adel Department Store incurred $8,000 of indirect advertising costs for its operations. The following 2005 data have been collected for its three departments:

Shoe Clothing Automotive

Direct advertising costs $7,000 $10,000 $3,000

Newspaper ad space 62% 20% 18%

Sales $160,000 $120,000 $120,000

How much of the indirect advertising costs of Adel (above) will be allocated to the Automotive if sales is the allocation base?

a. $2,400

b. $8,000

c. $3,200

d. $4,800  SOLUTION