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ruskin ruskin
wrote...
Posts: 664
6 years ago
Easton Photography Ltd. sells cameras and related equipment. It often packages these into bundles for sale to consumers. Currently it is offering the following "package" deal: a camera; a photo printer; and, a camera accessory pack that includes battery recharger, case and various lens adapters. The package deal is selling for $740. The individual prices and costs of these components are as follows:

Component   Selling Price   Unit Cost
Camera   $450   $350
Printer   $250   $150
Accessory Pack   $200   $75
Total      

Required:
Allocate the revenue among the products under each of the following:
a.   Unit selling prices
b.   Unit costs
c.   Physical units
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
Authors:
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1 Reply

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Replies
wrote...
6 years ago
a.   total SP = $450 + $250 + $200 = $900
   The allocations would be:
   $450/$900 * $740 or $370 to the Camera
   $250/$900 * $740 or $206 to the Printer
   $200/$900 * $740 or $$164 to the Accessory Pack

b.   total costs = $350 + $150 + $75 = $575
   The allocations would be:
   $350/$575 * $740 or $450 to the Camera
   $150/$575 * $740 or $193 to the Printer
   $75/$575 * $740 or $97 to the Accessory Pack

c.   Based on 3 physical individual unit products in the package, each product would be allocated    1/3 of $740 or $246.67 (rounded).
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