Check my wo The following information applies to the questions displayed below] National Bank has several departments that occupy both floors of a two-story building. The departmental accounting system has a single account, Building Occupancy Cost, in its ledger. The types and amounts of occupancy costs recorded in this account for the current period follow. Depreciation-Building Interest-Building mortgage Taxes-Building and land Gas (heating) expense Lighting expense Maintenance expense Total oceupancy cost $18,000 27,000 8,000 2,500 3,000 5,500 $ 64,000 The building has 4,000 square feet on each floor. In prior periods, the accounting manager merely divided the $64,000 occupancy cost by 8,000 square feet to find an average cost of $8 per square foot and then charged each department a building occupancy cost equal to this rate times the number of square feet that it occupied. Diane Linder manages a first-floor department that occupies 1,000 square feet, and Juan Chiro manages a second- floor department that occupies 1,900 square feet of floor space. In discussing the departmental reports, the second- floor manager questions whether using the same rate per square foot for all departments makes sense because the first-floor space is more valuable. This manager also references a recent real estate study of average local rental costs for similar space that shows first-floor space worth $30 per square foot and second-floor space worth $10 per square foot (excluding costs for heating, lighting, and maintenance) 5 6 of 6Next> K Prev Check my work 64,000 occupancy cost The building has 4,000 square feet on each floor. In prior perlods, the accounting manager merely divided the $64,000 occupancy cost by 8,000 square feet to find an average cost of $8 per square foot and then charged each department a building occupancy cost equal to this rate times the number of square feet that it occupied. Diane Linder manages a first-floor department that occupies 1,000 square feet, and Juan Chiro manages a second floor department that occupies 1,900 square feet of floor space. In discussing the departmental repo the second- floor manager questions whether using the same rate per square foot for all departments makes sense because the first-floor space is more valuable. This manager also references a recent real estate study of average local rental costs for similar space that shows first-floor space worth $30 per square foot and second-floor space worth $10 per square foot (excluding costs for heating, lighting, and maintenance). Required 1. Allocate occupancy costs to the Linder and Chiro departments using the current allocation method. (Round cost answers to 2 Total quare Linder's Dept Chiro's Dept Next > 560f 6
