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Software For You encounters revenue allocation decisions with its bundled product sales. Two or more ...

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Software For You encounters revenue allocation decisions with its bundled product sales. Two or more ...

Software For You encounters revenue allocation decisions with its bundled product sales. Two or more of the programs are sold as a single package. Managers at Software For You are keenly interested in individual product profitability figures. Information pertaining to its three bundled products and the stand-alone prices of its individual products is as follows:

   Stand-Alone Sales Price
   Word   Spread-   Accounting
   Processing    Sheet    Software   Package
Package   (WP)   (SS)   (AS)   Price
Package A   $125   $150   N/A   $220
Package B   125   N/A   $225   280
Package C   125   150   225   380

The unit inventory costs is $18, $20, and $25 for WP, SS, and AS, respectively. Assume AS is the primary product, followed by SS, then WP.

Required:
Allocate the bundle revenue to each product in Package C, using inventory unit costs as the weighting factor.

Textbook

Cost Accounting: A Managerial Emphasis, Canadian Edition

Edition: 7^th

Authors: Horngren, Datar, Rajan, Beaubien

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ashly138 Author

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6 years ago

Good timing, thanks!

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Brilliant ツ

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I appreciate what you did here, answered it right Smiling Face with Open Mouth

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