Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please help Konig Enterprises, Ltd., owns and operates three restaurants in Vancouver, B.C. The company allocates its fixed administrative expenses to the three restaurants on

please help image text in transcribed
image text in transcribed
Konig Enterprises, Ltd., owns and operates three restaurants in Vancouver, B.C. The company allocates its fixed administrative expenses to the three restaurants on the basis of sales dollars. Last year the fixed administrative expenses totaled $810,000 and were allocated as follows: Total sales-Last Year Percentage of total sales Allocation (based on the above percentages) Rick's Harborside $18,040,000 44% 5 356,400 Restaurants Imperial Garden $12, 710,000 31% 5 251, 100 Ginger Wok $10,250,000 25% $ 202,500 Total $41,000,000 100% $ 810,000 This year the Imperial Garden restaurant increased its sales by $1 million. The sales levels in the other two restaurants remained unchanged. The company's sales data for this year were as follows: Restaurants Taperial Garden $13, 710,000 33% Rick's Harborside $18,040,000 43% Total sales-This Year Percentage of total sales Ginger Wok $10,250,000 24% Total $42,000,000 100% Fixed administritive expenses for this year remained unchanged at $810,000 Required: 1. Using sales dollars as an allocation base, show the allocation of the fixed administrative expenses among the three restaurants for this year. 2. Calculate the change in each restaurant's allocated cost from last year to this year. 3. Is sales dollars a good base for allocation of fixed costs? Complate this question by entering your answers in the tabs below. Req 1 and 2 Reg 1. Using sales dollars as an allocation base, show the allocation of the fixed administrative expenses among the three restaurants for this year. 2. Calculate the change in each restaurant's allocated cost from last year to this year. (Negative amounts should be indicated by a minus sign.) Show less Rick's Harborside Imperial Garden Ginger Wok Total $ 1 Fixed administrative expense allocation - current year 2. Change in allocated cost ale

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Energy Management Audit And Conservation

Authors: U. P. Kumar Chaturvedula

1st Edition

6202015985, 978-6202015981

More Books

Students also viewed these Accounting questions

Question

Explain the steps involved in training programmes.

Answered: 1 week ago

Question

What are the need and importance of training ?

Answered: 1 week ago

Question

What is job rotation ?

Answered: 1 week ago

Question

Which form of proof do you find least persuasive? Why?

Answered: 1 week ago