Question

Ch 2 Homework Assignment 6 Problem 2-64 (Static) Cost Allocation with Cost Flow Diagram (LO 2-3) Coastal Computer operates two retail outlets in Oakview one on Main Street and the other in Lakeland Mall The stores share the use of a central accounting department. The cost of the accounting department for last year was $180.000. Following are the operating results for the two stores for the year Main Street $ 1,000,000 Lakeland Mall $ 2.000.000 1.600 Number of computers sold Required: a. Allocate the cost of the central accounting department to the two stores based on 1. Number of computers sold. 2. Store revenue References Complete this question by entering your answers in the tabs below. Red Al Req AZ Number of computers sold. (Do not round intermediate calculations.) Main Street Lakeland Mall Total Allocated accounting department cost Reg A2 >

Answer 1

Req a:
On the basis of Number of computers sold
Product		Number of computers		% allocated	Accounting cost
					allocated
Main street		2000		55.56%	100000
Lakeland mall		1600		44.44%	80000
TOTAL		3600		100.00%	180000
Rq b:
On the basis of Sales revenue
Product		Sales revenue		% allocated	Accounting cost
					allocated
Main street		1,000,000		66.67%	120000
Lakeland mall		2,000,000		33.33%	60000
TOTAL		3,000,000		100.00%	180000