Peter operates a dental office in his home. The office occupies 250 square feet of his residence, which is a total of 1,500 square feet. During 2014, Peter pays rent for his home of $12,000, utilities of $4,800, and maintenance expenses of $1,200. What amount of the total expenses should be allocated to the home office?

Question

Quizplus · Accepted Answer

The home office occupies 250/1500 = 1/6 of the total residence. Therefore, 1/6 of the total expenses ($12,000 + $4,800 + $1,200 = $18,000) should be allocated to the home office. 1/6 of $18,000 is $3,000.

Peter Operates a Dental Office in His Home