. | Calculate division margins in percentage terms prior to allocating fixed overhead costs. |
2. | Allocate indirect costs to the three divisions using each of the three allocation bases suggested. For each allocation base, calculate division operating margins after allocations, in dollars and as a percentage of revenues. |
3. | Discuss the results. How would you decide how to allocate indirect costs to the divisions? Why? |
4. | Would you recommend closing any of the three divisions in the short run (and possibly reallocating resources to other divisions) as a result of your analysis? If so, which division would you close and why? |
Bellini Hotel \& Casino is situated on beautiful Lake Tahoe in Nevada. The complex includes a 300-room hotel, a casino, and a restaurant. As Bellini's new controller, your manager asks you to recommend the basis the hotel should use for allocating fixed overhead costs to the three divisions in 2020. You are presented with the following income statement information for 2019 : (Click the icon to view the data.) You are also given the following data on the three divisions. (Click the icon to view the data.) You are told that $14,550,000. Read the requirements. Requirement 1. Calculate division margins in percentage terms prior to allocating fixed overhead costs. (Round your answers to two decimal places, X.XX.) Data table Requirements 1. Calculate division margins in percentage terms prior to allocating fixed 2. Allocate indirect costs to the three divisions using each of the three allocation bases suggested. For each allocation base, calculate division operating margins after allocations, in dollars and as a percentage of revenues. margins after allocations, in dollars and as a percentage of revenues. 3iscuss the results. How would you decide how to allocate indirect costs to the divisions? Why? the divisions? Why? Wossibly reallocating resources to other divisions) as a result of your analysis? If so, which division resing possibly reallocating resources to other divisions If so, which division would you close and why? Bellini Hotel \& Casino is situated on beautiful Lake Tahoe in Nevada. The complex includes a 300-room hotel, a casino, and a restaurant. As Bellini's new controller, your manager asks you to recommend the basis the hotel should use for allocating fixed overhead costs to the three divisions in 2020. You are presented with the following income statement information for 2019 : (Click the icon to view the data.) You are also given the following data on the three divisions. (Click the icon to view the data.) You are told that $14,550,000. Read the requirements. Requirement 1. Calculate division margins in percentage terms prior to allocating fixed overhead costs. (Round your answers to two decimal places, X.XX.) Data table Requirements 1. Calculate division margins in percentage terms prior to allocating fixed 2. Allocate indirect costs to the three divisions using each of the three allocation bases suggested. For each allocation base, calculate division operating margins after allocations, in dollars and as a percentage of revenues. margins after allocations, in dollars and as a percentage of revenues. 3iscuss the results. How would you decide how to allocate indirect costs to the divisions? Why? the divisions? Why? Wossibly reallocating resources to other divisions) as a result of your analysis? If so, which division resing possibly reallocating resources to other divisions If so, which division would you close and why