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John's Custom Computer Shop (JCCS) assembles computers for both individual and corporate customers. The company is organized into two divisions: Personal and Business. Once a

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John's Custom Computer Shop (JCCS) assembles computers for both individual and corporate customers. The company is organized into two divisions: Personal and Business. Once a computer is built. It is shipped to the customer. Biling for all customers is handled by the corporate Accounts Receivable Department Accounts Receivable performs two major activities: billing and dispute resolution Billing refers to preparing and sending the bills as well as processing the payments. Dispute resolution occurs when a customer refuses to pay, usually due to an error in billing. The costs of the Accounts Receivable Department are allocated to the two divisions based on the number of bills prepared, Kyle, the manager of the Business division, has complained that the allocated costs from Accounts Receivable are beginning to make the business division look unprofitable and has asked you to recommend some changes to the allocation system. If he agrees with your recommendation, he will pass them on to the chief financial officer. Data on costs and activities in the Accounts Receivable Department follow Personal Number of bills prepared Timber of disputes 600 55 300 15 900 70 The Accounts Receivable Department incurred the following costs during the year, Billing Dispute resolution Total $36,000 301 $76.50 Required: n. Under the current allocation system, what is the cost that will be allocated from Accounts Receivable to Personal? To Business? b. Suppose the company implements an activity-based cost system for Accounts Receivable with two activities, billing and dispute resolution. What is the cost that will be allocated from Accounts Receivable to Personal? To Business? Use the number of bills prepared as the cost driver for billing costs and the number of disputes for dispute resolution costs. Complete this question by entering your answers in the tabs below. Required Required Under the current allocation system, what is the cost that will be allocated from Accounts Receivable to personal To Busines? (Do not found intermediate calculations.) Partona Business Allocated costs Required) Required: .. Under the current allocation system, what is the cost that will be allocated from Accounts Receivable to Personal? To Business? b. Suppose the company Implements an activity based cost system for Accounts Receivable with two activities, billing and dispute Tesolution. What is the cost that will be allocated from Accounts Receivable to Personal? To Business? Use the number of bills prepared as the cost driver for billing costs and the number of disputes for dispute resolution costs. Complete this question by entering your answers in the tabs below. Required A Required Suppose the company implements an activity based cost system for Accounts Receivable with two activities, billing and dispute resolution. What is the cost that will be allocated from Accounts Receivable to personal? To Business? Use the number of bills prepared as the cost driver for billing costs and the number of disputes for dispute resolution costs. Personal Business Biling Dispute resolution

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