Gunaro Corporation manufactures appliances. It has four divisions Refrigerator, Stove, Dishwasher, and Microwave Oven. Each division is located in a different city and the headquarters is located in Thunder Bay, Ontario Headquarters incurs a total of $14,755,000 in costs, none of which are direct costs of any of the divisions. (Click to view information for each division and the main headquarters.) Gether wants to alocate the indirect costs of headquarters on the basis of either square metres or segment margin for each division Requirements 1. Allocate the indirect headquarters costs to each division, first using square metres of space and then using segment margin as the allocation base. Calculate the division operating margins after each allocation in dollars and as a percentage of revenue. 2. Which allocation base do you prefer? Why? 1. Should any of the divisions be dropped based on your calculations? Why of why not? Requirement 1. Allocate the indirect headquarters costs to each division, first using square metres of space and then using segment margin as the allocation base. Calculate the division operating margins after nach allocation in dollars and as a percentage of revenue. Let's begin by allocating costs based on square metres. (Enter percentages rounded to one decimal place) Refrigerator Stove Microwave Oven Total Dishwasher 60,000 Square metres 110,000 Next 140,000 90,000 400,000 Data table Revenues, costs, and facility space for each division are as follows: Microwave Oven Refrigerator Stove Dishwasher Revenue $ 10,900,000 $ 19,800,000 $ 11,700,000 $ 6,840,000 Direct costs 6,400,000 10,700,000 6,230,000 3,250,000 $ 4,500,000 $9,100,000 $ 5,470,000 $3,590,000 Segment margin Square metres of floor space occupied 140,000 110,000 60,000 90,000 Print Done - X d the he culate t Ganaro Corporation manufactures appliances It has four divisions: Refrigerator, Stove, Dishwasher, and Microwave Oven. Each division is located in a different city and the headquarters is located in Requirement 1. Alocate the indirect headquarters costs to each division, first using square metres of space and then using segment margin as the allocation base. Calculate the division operating margins after each allocation in dollars and as a percentage of revenue Let's begin by allocating costs based on square metres. (Enter percentages rounded to one decimal place) Refrigerator Stove 110,000 Dishwasher 60,000 Microwave Oven 90.000 Total 400,000 Square metres 140,000 square metres 100 % Allocated headquarter costs Next, calculate the division margin, based on the allocated headquarters costs in the previous step. Then, calculate the division margin as s percentage of revenue. (Round the division margin percentages to one decimal place Use a manus sign or parenthesis for any division margin losses. Round division margins to the nearest whole dollar) Refrigerator Microwave Oven Total Stove Dishwasher $9,100,000 $ 5,470,000 Segment margin 4.500.000 $ 22,000,000 Less: Headquarters costs Next S 3,590,000 Microwave Oven Refrigerator Stove Dishwasher Total Segment margin $ 4,500,000 $ 9,100,000 $ 5,470,000 $ 3,500,000 $ 22,660,000 Less: Headquarters costs Division margin Division margin percentage Next, we will allocate the headquarters costs by segment margin. (Enter percentages rounded to two decimal places. Round final answers to the nearest whole dollar) Refrigerator Stove Dishwasher Total Microwave Oven 3,590,000 Segment margin $ 4,500,000 $ 9,100,000 $ 5,470,000 $ $ 22,660,000 % segment margin % $ 14,755,000 Allocated headquarter costs 100% CE Now we can calculate the division margin, based on the allocated headquarters costs in the previous step. Then calculate the division margin as a percentage of revenue. (Round the division margin percentages to one decimal place Use a minus sign or parenthesis for any division margin losses Round division margins to the nearost whole dollar) Microwave Oven Refrigerator Total Stove Dishwasher $9,100,000 $ 5,470,000 $ 3,500,000 Segment margin $ 4.500.000 $ 22,660,000 Less: Headquarters costs 14.755.000 Division margin Division margin percentage Requirement 2. Which allocation base do you prefer? Why? I prefer the alocation based on because can also be justified on the principle-divisions with higher margins can hande more of the headquarters costs Requirement 3. Should any of the divisions be dropped based on your calculations? Why or why not? Requirement 2. Which allocation base do you prefer? Why? I prefer the allocation based on because margins can handle more of the headquarters costs Requirement 3. Should any of the divisions be dropped based on your calculations? Why or why not? should be dropped, since an also be justified on the before considering the headquarters' cost allocation principle-divisions with higher Gunars Corporation manufactures appliances. It has four divisions: Retigerator Slove, Dishwasher, and Microwave Oven. Each division is located in a different city and the headquarters is located in Bay, Ontario, Headquarters total of $14,755,000 in costs, none of which are direct costs of any of the divisions Click to view information for each division and the main headquarters) Gether wants to allocate the indrect costs of headquarters on the basis of either square metres or segment margin for each division Requirements 1. Allocate the indirect headquarters costs to each division, first using square metres of space and then using segment margin as the location base Calculate the division operating margins after each allocation in dollars and as a percentage of revenue 2. Which allocation base do you prefer? Why? 1. Should any of the divisions be dropped based on your calculations? Why or why not? res appliances. arters incurs a to or each division irect costs of he uarters costs to ate the division ou prefer? Why be dropped bas Data table Revenues, costs, and facility space for each division are as follows: Microwave Oven Refrigerator Stove Dishwasher Revenue $ 10,900,000 $ 19,800,000 $ 11,700,000 $ 6,840,000 6,400,000 10,700,000 6,230,000 3,250,000 Direct costs $ 4,500,000 $9,100,000 $ 5,470,000 $3,590,000 Segment margin Square metres of floor space occupied 140,000 110,000 60,000 90,000 Print This question: 15 point(s) possible - X Done Su d the headquarters is located Gunare Corporation manufactures appliances. It has four divisions: Refrigerator, Stove, Dishwasher, and Microwave Oven. Each division is located in a different city and the headquarters is located in Requirement 1. Allocate the indirect headquarters costs to each division, first using square metres of space and then using segment margin as the allocation base. Calculate the division operating margins after each allocation in dollars and as a percentage of revenue Let's begin by allocating costs based on square metres. (Enter percentages rounded to one decimal place) Refrigerator Stove 110,000 Dishwasher 60,000 Microwave Oven 00,000 Square metres 140,000 Total 400,000 100% 1 square metres 5 % Allocated headquarter costs Next, calculate the division margin, based on the allocated headquarters costs in the previous stop. Then, calculate the division margin as a percentage of revenue (Round the division margin percondages to one decimal place Use a meus sign or parenthesis for any division margin losses. Round division margins to the nearest whole dolar) Microwave Oven Refrigerator Total Stove Dishwasher $9,100,000 $ 5.470,000 Segment margin S 4,500,000 3.500,000 $ 22,000,000 Less: Headquarters costs Next SC ENG 222 AM 2022-04-29 Moitly doudly S 00 O Gunaro Corporation manufactures appliances. It has four divisions: Refrigerator, Slove, Dishwasher, and Microwave Oven. Each division is located in a different city and the headquarters is located in Segment margin $ 4.500.000 $9,100,000 5 5470,000 S 3,990,000 $ 22,000,000 Less: Headquarters costs Division margin Division margin percentage 1% Next, we will allocate the headquarters costs by segment margin (Enter percentages rounded to two decimal places. Round final answers to the nearest whole dollar) Refrigerator Total Stove $9.100.000 Dishwasher 55,470.000 Microwave Oven S 3.500.000 Segment margin 5 4.500.000 % segment margin $ 22,000,000 100% $ 14,755,000 Allocated headquarter costs Now we can calculate the division margin, based on the allocated headquarters costs in the previous step. Then calculate the division margin as a percentage of revenus (Round the division margen percentages to one decimal place. Use a minus sign or parenthesis for any division margin losses. Round division margins to the newest whole dalle Next 5C 480 222 AM 2022-04-29 US Mostly cloudy a Impen Refrigerator Stove Dishwasher Microwave Oven 3,500,000 Segment margin 4.500.000 $9,100,000 S 5470,000 $ Less: Headquarters costs Division margin Division margin percentage Requirement 2. Which allocation base do you prefer? Why? I prefer the allocation based on because margins can handle more of the headquarters costs Requirement 3. Should any of the divisions be dropped based on your calculations? Why or why not? should be dropped, since BALE JONK Q INTERN FORTRE THE THE TA Total $ 22,000,000 14,755.000 can also be justified on the before considering the headquarters' cost allocation 10 0 31 1 principle-divisions with higher Next ING 223 AM 2022-04-29 US 19.10