Homework Help: Accounting

Posted by Anonymous on Monday, March 31, 2008 at 6:39pm.

A company has two major businesses that it operates. One business manufactures and sells unicycles for commercial use in circuses, etc. (total sales of $150M), and the other sells bicycles to the public (total sales of $20M). The unicycle business occupies 75,000 square feet of the manufacturing warehouse and the bicycle business occupies the remaining 25,000 square feet. Cost were split 50-50 between the 2 businesses for advertising (total advertising expense of $5M) and warehouse expense (total warehouse expense of $3M) in the past (traditional method).

1. What was the cost of advertising and warehouse expense allocated to each of the business based on the traditional method?
2. What recommendation would you make in allocating these expenses to each of the business and how much would be allocated to each business?
3. What would be some of the issues of too many expenses or too little expenses being allocated to each of the businesses?

Accounting - La Roy, Wednesday, April 2, 2008 at 11:33pm
do your own home work cheater!

Answer this Question

Related Questions

Accounting - A company has two major businesses that it operates. One business ...
Growth model - Hello everyone. My task is to build a growth model for a company...
Principles of Business - Identify and discuss THREE features which could be used...
math - The Math-Is-Fun T-shirt Company manufactures and sells screen-printed t-...
Business - Unigate is a European food and distribution group. Its businesses ...
math - setup an equation or expression to model the situation below: in one year...
accounting - "Harris Company manufactures and sells a single product. A ...
Accounting - Sherman's interiors sells lamps. At March 31, the company had ...
business finance - if the break-even point in dollar sales for a company is $...
Math - The total sales of a company in 2008 were $45,000. In 2011, it grew to $...

For Further Reading

First Name:
School Subject:
Answer: