Diane Thrift owns a personnel services company that provides temporary employees

Question

Diane Thrift owns a personnel services company that provides temporary employees in four employment categories: (a) office/clerical; (b) hotel/motel; (c) restaurant/dining; and (d) hospital/medical. Ms. Thrift has organized her company into four departments, one for each category. The lease expense for her company office space is $8,700 per month. She allocates the monthly lease expense among the four departments based on the number of temporary employees in each business category. Calculate the percents and the resulting allocations. Round each percent to the nearest whole number.

Department Number of Employees Percent of Total Allocation of Rent (a) Office/clerical 270 %______ $ ______ (b) Hotel/motel 90 %______ $ ______ (c) Restaurant/dining 450 %______ $ ______ (d) Hospital/medical 290 %______ $ ______        Total 1,100 100% $8,700

Explanation / Answer

Answer

Working

(a) Office/clerical

Percent of Total = 270/1100 = 25%

Allocation of Rent = 25%*8700 = 2175

(b) Hotel/motel

Percent of Total = 90/1100 = 8%

Allocation of Rent = 8%*8700 = 696

(c) Restaurant/dining

Percent of Total = 450/1100 = 41%

Allocation of Rent = 41%*8700 = 3567

(d) Hospital/medical

Percent of Total = 290/1100 = 26%

Allocation of Rent = 26%*8700 = 2262

Department Number of Employees Percent of Total Allocation of Rent (a) Office/clerical 270 25% $2,175 (b) Hotel/motel 90 8% $696 (c) Restaurant/dining 450 41% $3,567 (d) Hospital/medical 290 26% $2,262        Total 1,100 100% $8,700

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