There are three departments in a factory. Department A occupies 2,000 sq. ft Department B occupies 2,500 sq. ft Department C occupies 500 sq. ft Annual rent £40,000 The combined rent of Department A and B is A £16,000 B £20,000 C £24,000 D £36,000

There are three departments in a factory. Department A occupies 2,000 sq. ft Department B occupies 2,500 sq. ft Department C occupies 500 sq. ft Annual rent £40,000 The combined rent of Department A and B is A £16,000 B £20,000 C £24,000 D £36,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

100%

There are three departments in a factory.

Department A occupies 2,000 sq. ft

Department B occupies 2,500 sq. ft

Department C occupies 500 sq. ft

Annual rent £40,000

The combined rent of Department A and B is

A £16,000

B £20,000

C £24,000

D £36,000

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