Help Sav pter 22 Homework 3 A company purchases a 8,190-square-foot commercial b

Question

Help Sav pter 22 Homework 3 A company purchases a 8,190-square-foot commercial building for $440,000 and spends an additional $92,000 to divide the space into two separate rental units and prepare it for rent. Unit A, which has the desirable location on the comer and contains 2,340 square feet, will be rented for $2.00 per square foot Unit 8 contains 5,850 square feet and will be rented for $1.20 per square foot How much of thve joint cost should be assigned to Unit B using the value basis of allocation? Joint Cost Reference lks MacBook Air 5 8

Explanation / Answer

Area(Sq. ft) Rate/ Sq. ft Market value Joint cost Apportioned cost Unit A 2340 $      2.00 $     4,680.00 =532000/11700*4680=212800 Unit B 5850 $      1.20 $     7,020.00 =532000/11700*7020=319200 8190 $ 11,700.00 532000 Please hit the like button if the answer helped you else leave a comment for further clarification. Thank you! All the best!

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