Question

Nordie's has four departments: retail, accounting, inventory, and sales. The company occupies 4,200 square feet of space in downtown Chicago with retail using 1900 sq. ft, accounting using 600 sq. ft., inventory using 1000 sq. ft, and sales using 700 sq. ft. The firm pays $21,420 per month to rent it’s office. How much monthly rent cost should Nordie's allocate to sales based off sq. ft? $3,570 $2,880 $5,355 $7,560

Answer 1

The calculation of monthly rent cost which should Nordie's allocate to sales based off sq. ft is shown below:

Sales based rent cost = total rent* area occupied by sales based/total area

= $21,420*700 Sq.ft./4,200 Sq.ft

= $3,570

Therefore, the correct answer is $3,570.