Help Save & Exit S MC Qu. 100 A company pays... A company pays $20,000 per perio

Question

Help Save & Exit S MC Qu. 100 A company pays... A company pays $20,000 per period to rent a small building that has 10,500 square feet of space. This cost is allocated to the company's ts on the basis of the amount of the space occupied by each. Department One occupies 2100 square feet of floor space O square feet of floor space, and Department Three occupies 5,250 square feet of floor space. If the rent is allocated based on the total square footage of the space, Department One should be charged rent expense for the period of Multiple Choice $5,900. $4,000. $4.200

Explanation / Answer

Total Rent of the Building = $20,000

Total Square-feet of space = 10,500

Rent Per Sqaure-feet = 20000 / 10500 = $1.9047619048 per square-feet

Department one should be charged rent expense for the period :

1.9047619048 * 2100 = $4,000.

Answer - $4,000

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