Lee Shu−yu Inc. produces and sells DVDs to business people and students who are planning extended stays in China. It has been very successful with two DVDs: Beginning Mandarin and Conversational Mandarin. It is introducing a third DVD, Reading Chinese Characters. It has also decided to market its new DVD in two different packages grouping the Reading Chinese Characters DVD with each of the other two language DVDs. Information about the separate DVDs and the packages follow. Read the requirements2. Requirement 1. Using the selling prices, allocate revenues from the BegM + RCC package to each DVD in that package using (a) the stand-alone method; (b) with BegM and RCC in turn as the primary product. (Round your answers to the nearest cent.) BegM RCC (a) Stand-alone (b) Incremental: BegM primary user (b) Incremental: RCC primary user Requirement 2. Using the selling prices, allocate revenues from the ConM + RCC package to each DVD in that package using (a) the stand-alone method; (b) the incremental method, with ConM and RCC in turn as the primary product. (Round your answers to the nearest cent.) ConM RCC (a) Stand-alone (b) Incremental: ConM primary user (b) Incremental: RCC primary user Requirement 3. Which method is most appropriate for allocating revenues among the DVDs? Why? Below are three situations, select the method(s) that would be most appropriate for each situation. The (1) method(s) would be fair if the demand for the DVDs are approximately equal. The (2) method might be slightly preferable here since it is simpler and easier to explain. The (3) method would be appropriate if one DVD has a higher level of demand than the other DVD. In this situation, the dominant DVD would be sold anyway so it should receive its (4) revenue, and the other DVD should receive the remainder. 1: Data Table DVD Selling Price Beginning Mandarin (BegM) $48 Conversational Mandarin (ConM) $128 Reading Chinese Characters (RCC) $32 BegM + RCC $60 ConM + RCC $150 2: Requirements 1. Using the selling prices, allocate revenues from the BegM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with BegM and RCC in turn as the primary product. 2. Using the selling prices, allocate revenues from the ConM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with ConM and RCC in turn as the primary product. 3. Which method is most appropriate for allocating revenues among the DVDs? Why?

Lee Shu−yu Inc. produces and sells DVDs to business people and students who are planning extended stays in China. It has been very successful with two DVDs: Beginning Mandarin and Conversational Mandarin. It is introducing a third DVD, Reading Chinese Characters. It has also decided to market its new DVD in two different packages grouping the Reading Chinese Characters DVD with each of the other two language DVDs. Information about the separate DVDs and the packages follow. Read the requirements2. Requirement 1. Using the selling prices, allocate revenues from the BegM + RCC package to each DVD in that package using (a) the stand-alone method; (b) with BegM and RCC in turn as the primary product. (Round your answers to the nearest cent.) BegM RCC (a) Stand-alone (b) Incremental: BegM primary user (b) Incremental: RCC primary user Requirement 2. Using the selling prices, allocate revenues from the ConM + RCC package to each DVD in that package using (a) the stand-alone method; (b) the incremental method, with ConM and RCC in turn as the primary product. (Round your answers to the nearest cent.) ConM RCC (a) Stand-alone (b) Incremental: ConM primary user (b) Incremental: RCC primary user Requirement 3. Which method is most appropriate for allocating revenues among the DVDs? Why? Below are three situations, select the method(s) that would be most appropriate for each situation. The (1) method(s) would be fair if the demand for the DVDs are approximately equal. The (2) method might be slightly preferable here since it is simpler and easier to explain. The (3) method would be appropriate if one DVD has a higher level of demand than the other DVD. In this situation, the dominant DVD would be sold anyway so it should receive its (4) revenue, and the other DVD should receive the remainder. 1: Data Table DVD Selling Price Beginning Mandarin (BegM) $48 Conversational Mandarin (ConM) $128 Reading Chinese Characters (RCC) $32 BegM + RCC $60 ConM + RCC $150 2: Requirements 1. Using the selling prices, allocate revenues from the BegM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with BegM and RCC in turn as the primary product. 2. Using the selling prices, allocate revenues from the ConM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with ConM and RCC in turn as the primary product. 3. Which method is most appropriate for allocating revenues among the DVDs? Why?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Chinese Characters DVD with each of the other two language DVDs.

Information about the separate DVDs and the packages follow.

Read the requirements2.

Requirement 1. Using the selling prices, allocate revenues from the

BegM + RCC package to each DVD in that package using (a) the stand-alone method; (b) with BegM and RCC in turn as the primary product. (Round your answers to the nearest cent.)

	BegM	RCC
(a) Stand-alone
(b) Incremental: BegM primary user
(b) Incremental: RCC primary user

Requirement 2. Using the selling prices, allocate revenues from the ConM
+ RCC package to each DVD in that package using (a) the stand-alone method; (b) the incremental method, with ConM and RCC in turn as the primary product. (Round your answers to the nearest cent.)

	ConM	RCC
(a) Stand-alone
(b) Incremental: ConM primary user
(b) Incremental: RCC primary user

Requirement 3. Which method is most appropriate for allocating revenues among the DVDs? Why?

Below are three situations, select the method(s) that would be most appropriate for each situation.

The (1) method(s) would be fair if the demand for the DVDs are approximately equal.

The (2) method might be slightly preferable here since it is simpler and easier to explain.

The (3) method would be appropriate if one DVD has a higher level of demand than the other DVD. In this situation, the dominant DVD would be sold anyway so it should receive its

(4) revenue, and the other DVD should receive the remainder.

1: Data Table

DVD	Selling Price
Beginning Mandarin (BegM)	$48
Conversational Mandarin (ConM)	$128
Reading Chinese Characters (RCC)	$32
BegM + RCC	$60
ConM + RCC	$150

2: Requirements

1.	Using the selling prices, allocate revenues from the BegM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with BegM and RCC in turn as the primary product.
2.	Using the selling prices, allocate revenues from the ConM+ RCC package to each DVD in that package using (a) the stand-alone method; and (b) the incremental method, with ConM and RCC in turn as the primary product.
3.	Which method is most appropriate for allocating revenues among the DVDs? Why?

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Accounting for Foreign Exchange Transactions

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.