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Required Information [The folowing information applles 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 perlod follow Depreciation-Building Interest-Building mortgage Taxes-Building and land Gas (heating) expense Lighting expense Maintenance expense Total oeeupancy cost $ 18,000 2,000 8,000 2, 500 3,000 5, 500 $ 64,000 The building has 4,000 square feet on each floor. In prior pertods, t the accounting manager merely divided the $64,000 occupancy cost by 8,000 squ bulding occupancy cost equal to this rate times the number of square feet that It occupled are feet to find an average cost of $8 per square foot and then charged each department a Dlane Linder manages a first-floor department that occuples 1.000 square feet, and Juan Chiro manages a second-floor department that occuples 1800 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 simllar space that shows firstfloor space worth $40 per square foot and second-floor space worth $10 per square foot (excluding costs for heating, lighting. and maintenance). 2 Allocate the depreclation, Interest, and taxes occupancy costs to the Linder and Chiro departments In proportion to the relative market values of the floor space. Allocate the heating, lighting, and maintenance costs to the Linder and Chiro departments in proportion to the square feet occupled (gnoring floor space market values). (Round cost answers to 2 decimal places. Round your Intermedlate calculations to 2 decimal places.) Square Rate Total Department Linders Department Chiros Department
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