A company pays $15,000 per period to rent a small building that has 10,000 square feet of space. This cost is allocated to the company's three departments on the basis of the amount of the space occupied by each. Department One occupies 2,000 square feet of floor space, Department Two occupies 3,000 square feet of floor space, and Department Three occupies 5,000 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:

Question

Quizplus · Accepted Answer

Department One occupies 2,000 out of 10,000 total square feet, which is 20% of the space. Therefore, 20% of the $15,000 rent is $3,000.

A Company Pays $15,000 Per Period to Rent a Small