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Best Solutions, Inc., sells computer hardware to end consumers. The CX30 is sold as a bundle, which includes three hardware products: a personal computer (PC)
Best Solutions, Inc., sells computer hardware to end consumers. The CX30 is sold as a "bundle", which includes three hardware products: a personal computer (PC) tower, a 26-inch monitor, and a color laser printer. Each of these products is made in a separate manufacturing division of Best Solutions and can be purchased individually as well as in a bundle. Best Solutions sells roughly equal quantities of the three products. The individual selling prices and per unit costs are as follows: (Click to view the data.) Read the requirements. Requirement 1. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on the individual selling price per unit. (Enter the allocation proportion as a decimal rounded to five decimal places. Round the revenue allocated to the nearest whole dollar.) Computer component Revenue Allocated Allocation Proportion 513 PC tower 315 Monitor 153 171 Color laser printer 234 414 i X Data Table Computer Component Individual Selling Price Per Unit Cost Per Unit PC Tower $ 684 $ 385 Monitor 204 $ 209 Color laser printer $ 312 $ 506 Computer bundle purchase price $ 900 Print Done X Requirements el Ets d 1. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on the individual selling price per unit. 2. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on cost per unit. 3. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on physical units (that is, the number of individual units of product sold per bundle). 4. Which basis of allocation makes the most sense in this situation? Explain your answer. Print Done
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