Harbor Corp Currently Leases a Corporate Suite in an Office

question 64

Multiple Choice

Harbor Corp currently leases a corporate suite in an office building for a cost of $360,000 a year. Only 80% of the corporate suite is currently being used. A start-up business has proposed a plan that would use the other 20% of the suite and increase the overall costs of maintaining the space by $20,484. If the incremental method were used, what amount of cost would be allocated to the start-up business?

• A) $20,484
• B) $380,484
• C) $76,097
• D) $88,387

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Definitions:

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