Staffordshire Brothers rents space to a pet store and pet grooming business. Staffordshire Brothers provides payroll/tax reporting services and custodial services as part of the rental contract. To determine the monthly rental fee, Staffordshire Brothers must allocate the payroll/tax reporting costs and the custodial services costs to the pet store and the grooming business. Payroll/tax reporting services are allocated based on number of employees and custodial services are allocated based on space occupied. Costs reported are for the year.
REQUIRED
If Staffordshire Brothers uses the direct method to allocate costs, what are the monthly rental charges for the pet store and the pet grooming business? (Hint: First, allocate the payroll/tax reporting services costs and the custodial services costs to the pet store and the pet grooming business. Then, add the direct costs and allocated costs together and divide by 12 (months in a year).
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