Need help with this question solution general accounting A business leases a building with a total of 80,000 square feet split equallybetween two floors. The company charges rent for the first floor at threetimes the rate of the second floor. The total monthly rent is $40,000. Howmuch monthly rental expense should be allocated to a department thatoccupies 15,000 square feet on the first floor? (Do not round intermediatecalculations.)A. $12,000B. $7,500C. $15,000D. $9,000E. $11,250

Step 1: Analysis of information givenTotal area of the building = 80,000 square feetThis area is…

Answered: A business leases a building with a…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter11: Work Sheet And Adjusting Entries

Section: Chapter Questions

Problem 8DQ

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A company purchases a 10,020-square-foot commercial building for $325,000 and spends an additional $50,000 to divide the space into two separate rental units and prepare it for rent. Unit A, which has the desirable location on the corner and contains 3,340 square feet, will be rented for $1.00 per square foot. Unit B contains 6,680 square feet and will be rented for $0.75 per square foot. How much of the joint cost should be assigned to Unit B using the value basis of allocation?
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