Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Office Magic, Inc., sells computer hardware to end consumers. The CX30 is sold as a bundle, which includes three hardware products: a personal computer
Office Magic, Inc., sells computer hardware to end consumers. The CX30 is sold as a "bundle", which includes three hardware products: a personal computer (PC) tower, a 26-inch monitor, and a color laser printer. Each of these products is made in a separate manufacturing division of Office Magic and can be purchased individually as well as in a bundle. Office Magic sells roughly equal quantities of the three products. The individual selling prices and per unit costs are as follows: (Click to view the data.) Read the requirements. Requirement 1. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on the individual selling price per unit. (Enter the allocation proportion as a decimal rounded to five decimal places. Round the revenue allocated to the nearest whole dollar.) Computer component PC tower Monitor Color laser printer Allocation Proportion Etext pages Calculator Revenue Allocated Data table Computer Component Individual Selling Price Per Unit Cost Per Unit PC Tower $ 1,064 $ 329 Monitor 342 $ 126 Color laser printer 494 $ 245 Computer bundle purchase price $ 900 Office Magic, Inc., sells computer hardware to end consumers. The CX30 is sold as a "bundle", which includes three hardware products: a personal computer (PC) tower, a 26-inch monitor, and a color laser printer. Each of these products is m in a bundle. Office Magic sells roughly equal quantities of the three products. The individua (Click to view the data.) Read the requirements. Requirements Requirement 1. Allocate the revenue from the allocation proportion as a decimal rounded to Allocation Pro Computer component PC tower Monitor Color laser printer 1. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on the individual selling price per unit. 2. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on cost per unit. 3. Allocate the revenue from the computer bundle purchase to each of the hardware products using the stand-alone method based on physical units (that is, the number of individual units of product sold per bundle). 4. Which basis of allocation makes the most sense in this situation? Explain your answer. Etext pages Calculator Print Done Color laser printer Computer bundle purchase price the individual selling price per unit. (Enter the e Per Unit Cost Per Unit 1,064 $ 329 342 $ 126 494 $ 245 900 -
Step by Step Solution
There are 3 Steps involved in it
Step: 1
The computer bundle is sold for 1900 Using the standalone allocatio...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started