Please use the information provided below to develop a fully allocated monthly income statement for Mayflower Hotel. The allocation is based on numbers of employees working for the department. You need to allocate each of the overhead cost to profit centers (e.g., room dept., food and beverage dept., and gift shop). Please work on the following steps: Step 1. Please complete table 1 and table 2 for necessarily information. Step 2. Use the information from Table 2 to complete your fully allocated income statement in Table 3. The shaded areas in three tables should be completed after you complete this question. Step 3. Your assistant manager believes that your F&B Dept. and Gift Shop are comparable in terms of generating profit based on the departmental income. What do you think after you allocate the overhead?

Problem 1. Please use the information provided below to develop a fully allocated monthly income statement for Mayflower Hotel. The allocation is based on numbers of employees working for the department. You need to allocate each of the overhead cost to profit centers (e.g., room dept.. food and beverage dept., and gift shop). Please work on the following steps: Step 1. Please complete table 1 and table 2 for necessarily information. Step 2. Use the information from Table 2 to complete your fully allocated income statement in Table 3. The shaded areas in three tables should be completed after you complete this question. Step 3. Your assistant manager believes that your F&B Dept. and Gift Shop are comparable in terms of generating profit based on the departmental income. What do you think after you allocate the overhead? Table 1. Number of Employees in each department % (used for Department Number of Employees allocation Rooms 65 52% Food 35 Gift Shop 25 A&G 10 Marketing 5 Property Operation 10 Note: % denotes the percentage of overhead cost allocated to the corresponding department Table 2. Allocating overhead cost to each profit center Amount Amount Amount allocated to allocated to allocated to Gif Overhead Cost Area Total Overhead Cost Rooms F&B Shop Admin & General S 80,000 Sales & Marketing $ 76,500 Property Operation & Mais 70,000 Insurance S 10,000 Depreciation $ 65,000 620.000 Table 3 Fully Allocated Income Statement for Mayflower Hotel Rooms Food Gift Shop Total Departmental Income $ 325,000 $ 145,000 $ 150.000 $ Allocated overhead costs Admin & General $ Sales & Marketing $ Property Operation & Maintenance S Insurance $ Depreciation $ 80.000 76.500 70,000 10,000 65,000 Department income after allocation $ 168,220$ 60,580 $ 318.500 S 50,000.00 Income tax Net Income