A retailer pays $150,000 rent each year for its two-story building. Space in this building is occupied by five departments as shown here. Department Jewelry Cosmetics Department Housewares Tools Shoes Square feet occupied TATS 1,610 (first-floor) 2,990 (first-floor) The company allocates $97,500 of total rent expense to the first floor and $52,500 to the second floor. It then allocates rent expense for each floor to the departments on that floor based on square feet occupied. Determine the rent expense to be allocated to each department. First Floor Jewelry Department Cosmetics Department Totals Second Floor Housewares Department Square feet occupied 2,878 (second-floor) 828 (second-floor) 1,702 (second-floor) Tools Department Shoes Department Totals Square Feet Percent of Total 1,610 INIT 2.990 HIL% 14,600 Square Feet 1111112,070 828 0% Percent of Total 40% Cost Allocated $ Cost Allocated 1,702% 4,600 !!!!!!! 0% S 0 0 K
A retailer pays $150,000 rent each year for its two-story building. Space in this building is occupied by five departments as shown here. Department Jewelry Cosmetics Department Housewares Tools Shoes Square feet occupied TATS 1,610 (first-floor) 2,990 (first-floor) The company allocates $97,500 of total rent expense to the first floor and $52,500 to the second floor. It then allocates rent expense for each floor to the departments on that floor based on square feet occupied. Determine the rent expense to be allocated to each department. First Floor Jewelry Department Cosmetics Department Totals Second Floor Housewares Department Square feet occupied 2,878 (second-floor) 828 (second-floor) 1,702 (second-floor) Tools Department Shoes Department Totals Square Feet Percent of Total 1,610 INIT 2.990 HIL% 14,600 Square Feet 1111112,070 828 0% Percent of Total 40% Cost Allocated $ Cost Allocated 1,702% 4,600 !!!!!!! 0% S 0 0 K
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 30E: A company uses charging rates to allocate service department costs to the using departments. The...
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Question
![A retailer pays $150,000 rent each year for its two-story building. Space in this building is occupied by five departments as shown
here.
Department
Jewelry
Cosmetics
Department
Housewares
Tools
Shoes
First Floor
Jewelry Department
Cosmetics Department
Totals
The company allocates $97,500 of total rent expense to the first floor and $52,500 to the second floor. It then allocates rent expense
for each floor to the departments on that floor based on square feet occupied.
Determine the rent expense to be allocated to each department.
Second Floor
Housewares Department
Square feet occupied
1,610 (first-floor)
2,990 (first-floor)
Tools Department
Shoes Department
Totals
Square feet occupied
2,070 (second-floor)
828 (second-floor
1,702 (second-floor)
Square Feet
1.610
INN 2,990
14,600
Square Feet
(1
2,070
828
1,702
14.600
Percent of Total
%
%
HIIH 0%
Percent of Total
LLL
%
%
%
0 %
201
Cost Allocated
$
Cost Allocated
51
2012
277](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3e525ad7-fa69-4497-95c6-714438b97072%2Fc202a25c-d898-418d-8680-4307a7e3db43%2Foo99k7u_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A retailer pays $150,000 rent each year for its two-story building. Space in this building is occupied by five departments as shown
here.
Department
Jewelry
Cosmetics
Department
Housewares
Tools
Shoes
First Floor
Jewelry Department
Cosmetics Department
Totals
The company allocates $97,500 of total rent expense to the first floor and $52,500 to the second floor. It then allocates rent expense
for each floor to the departments on that floor based on square feet occupied.
Determine the rent expense to be allocated to each department.
Second Floor
Housewares Department
Square feet occupied
1,610 (first-floor)
2,990 (first-floor)
Tools Department
Shoes Department
Totals
Square feet occupied
2,070 (second-floor)
828 (second-floor
1,702 (second-floor)
Square Feet
1.610
INN 2,990
14,600
Square Feet
(1
2,070
828
1,702
14.600
Percent of Total
%
%
HIIH 0%
Percent of Total
LLL
%
%
%
0 %
201
Cost Allocated
$
Cost Allocated
51
2012
277
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