Blanton Company wishes to allocate rent expense of $24,000 to its three operating departments, A, B, and C. Assuming the three departments occupy 10,000, 20,000, and 30,000 square feet, respectively, the cost allocation rate for Department C is $0.80 per square foot.
Answer the following statement true (T) or false (F)
False
Allocation rate = Total cost to be allocated ÷ Cost driver (allocation base)
Allocation rate = $24,000 ÷ (10,000 sq. ft. + 20,000 sq. ft. + 30,000 sq. ft.) = $0.40 per sq.ft.
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Indicate whether the statement is true or false
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