QUESTION 6 (10 Marks) A company provides a wide range of telecommunications products and services across Canada. The company offers stand-alone products as well as different packages of bundled services. The current prices for the most popular package deals and the stand-alone products are as follows: Product Price/Month Revenues Required a. If the company uses the stand-alone revenue-allocation method based on selling prices, determine the revenues allocated to individual products for the Internet and television package deal. (2 marks) b. If the company uses the stand-alone revenue-allocation method based on product revenues, determine the revenues allocated to individual products for the television and wireless package deal. ( 2 marks) c. If the company uses the incremental revenue-allocation method based on selling prices, determine the revenues allocated to individual products for the Internet, television, and wireless package deal. Assume that wireless is the primary product and Internet is the first incremental product. (2 marks) d. Assume now that all three products are under the responsibility of different managers and that each manager receives a bonus based on the operating profit generated by the product under his or her responsibility. Also assume that the managers of the products have control over the pricing of the package deals. To have a fair and motivating compensation plan, indicate which allocation method from parts a), b), and c) is the most appropriate and beneficial to both the managers and the company. Explain why. (2 marks) e. Now assume that the managers do not have control over the prices of the products. The marketing department is solely responsible for pricing of the package deals. The company would like to create competition among managers to create a high demand for their individual products. Indicate the most appropriate revenue allocation method and explain why? (2 marks)