Question
ezto.mheduction.com/hm.tpx (110%) | | |a search lin value 25.00 points QS 22-18B Joint cost allocation LO C3 A company purchases a 12.420 square foot commercial building for $350,000 and spends an additional $98,000 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 720 square feet, will be rented for $2.50 per square foot. Unit B contains 4,800 square feet and will be rented for $1.50 per square foot How much ot the joint cost should be assigned to Unit B using the value basis of allocation? Apportioned Cost Market Value Percent of Market Value Joint Cost Numerator | Denominator | % of Mkt Value Unit A Unit B Totals 9:09 AM 0 Type here to search ^ q) 12/2/2017
Explanation / Answer
Joint cost to be assigned to Unit B: $78400
Market Value Percent of Market Value Joint Cost Apportioned Cost Numerator Denominator % of Mkt Value Unit A 1800 1800 9000 20 98000 19600 Unit B 7200 7200 9000 80 78400 Totals 9000 100 98000
