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Jenny's Cupcake Shop and Jackie's Cakes each operate a bakery close to each other in a small town in Florida. If Jenny rents ovens on
Jenny's Cupcake Shop and Jackie's Cakes each operate a bakery close to each other in a small town in Florida. If Jenny rents ovens on her own, it will cost $42,000. If Jackie rents ovens on her own, it will cost $54,000. If they consolidate baking operations and share ovens, the total cost will be $80,000. Read the requirements C. Requirement 1. Calculate Jenny's and Jackie's respective cost of the shared ovens under the stand-alone cost-allocation method. Jenny Jackie Stand-alone Requirement 2. Calculate Jenny's and Jackie's respective cost of the shared ovens using the incremental cost-allocation method assuming (a) Jenny is the primary party and (b) Jackie is the primary party Jenny Jackie Incremental Jenny primary user Jackie primary user Requirement 3. Calculate Jenny's and Jackie's respective cost of the shared ovens using the Shapley value method. Jenny Jackie Shapley Requirement 4. Which method would you recommend Jenny and Jackie use to share the cost of the ovens? Why? I would recommend the It is fairer than the which V. Given its simplicity, the v is likely more acceptable. - Requirements 1. Calculate Jenny's and Jackie's respective cost of the shared ovens under the stand-alone cost-allocation method. 2. Calculate Jenny's and Jackie's respective cost of the shared ovens using the incremental cost-allocation method assuming (a) Jenny is the primary party and (b) Jackie is the primary party 3. Calculate Jenny's and Jackie's respective cost of the shared ovens using the Shapley value method. 4. Which method would you recommend Jenny and Jackie use to share the cost of the ovens? Why
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