The Maryville Construction Company Occupies 85,000 Square Feet for Construction

Multiple Choice

The Maryville Construction Company occupies 85,000 square feet for construction of mobile homes. There are two manufacturing departments, finishing and assembly, and four service departments labeled S1, S2, S3, and S4. Information relevant to Maryville is as follows:

Rent paid for the area used is $720,000.
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How much rent would be charged to S4 using the step method of allocation and a S3-S4-S1-S2 sequence for the allocations?

A) $36,000.
B) $40,000.
C) $54,000.
D) $90,000.