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jerico jerico
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9 years ago
Max's Movie Store encounters revenue-allocation decisions with its bundled product sales. Here, two or more of the movie videos are sold as a single package. Managers at Max's are keenly interested in individual product-profitability figures. Information pertaining to its three bundled products and the stand-alone selling prices of its individual products is as follows:

   Stand-Alone Selling Price,   Cost      Package   Packaged Price
New Releases   $15   $2.00      New & Older   $20
Older Releases   $10   $1.50      New & Classics   $17
Classics   $8   $1.25      All three   $25

Required:
a.   With selling prices as the weights, allocate the $25 packaged price of "All Three" to the three videos using the stand-alone revenue-allocation method.

b.   Allocate the $25 packaged price of "All Three" to the three types of videos using the incremental revenue-allocation method. Assume New Releases is the primary product, followed by Older Releases, and then Classics.
Textbook 
Cost Accounting

Cost Accounting


Edition: 14th
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cyborgcyborg
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9 years ago
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jerico Author
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#2
9 years ago
I can confidently say that it looks and sounds right lol Thank you Slight Smile Give this man a thumbs up.
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#3
9 years ago
Cool! No problem.
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