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Woodland Hotels, Inc., operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the
Woodland Hotels, Inc., operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the resort: Pine Valley, Oak Glen, Mimosa, and Birch Glen. Woodland allocates its central office costs to each of the four resorts according to the annual revenue the resort generates. For the current year, the central office costs (000s omitted) were as follows: Front office personnel (desk, clerks, etc.) Administrative and executive salaries Interest on resort purchase Advertising Housekeeping Depreciation on reservations computer Room maintenance Carpet-cleaning contract Contract to repaint rooms $ 8,000 4,000 3,000 600 2,000 80 800 50 400 Cost to be allocated Revenue (000s) Square feet Rooms Assets (000s) $ 18,930 Pine Valley Oak Glen $ 5,350 $ 7,995 55,475 86 76.599 122 Mimosa $ 8,857 41,774 Birch Glen $ 6,550 $ 92,345 $ 138,745 $ 72,355 $ 57,499 83,664 174 Total $ 28,752 257,512 448 $358,944
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