Kahn Industry, Inc. has three divisions. The following information was available for last quarter.

	Division A	Division B	Division C	Company
Revenues	$200,000	$320,000	$140,000	$660,000
Cost of goods (or services) sold	160,000	240,000	100,000	500,000
Gross margin	$40,000	$ 80,000	$ 40,000	$160,000
Marketing and administrative costs	18,000	20,000	12,000	50,000
Operating profit	$ 22,000	$ 60,000	$ 28,000	$110,000
Interest				10,000
Income taxes (30%)				30,000
Net income				$ 70,000

The CEO of Kahn Industry wanted to allocate the interest cost of $10,000 to the three divisions.

Required:

1. Identify the cost object(s) and the cost pool.
2. Allocate the interest cost based on each divisions (1) revenues, (2) gross margin, and (3) operating profit.
3. Draw a cost flow diagram assuming the allocation of interest cost is based on revenues.