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Woodland Hotels Incorporated operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the resort: Pine Valley, Oak Glen, Mimosa, and Birch Glen. Woodland allocates its central office costs to each of the four resorts according to the annual revenue the resort generates. For the current year, the central office costs (000s omitted) were as follows: Front office personnel (desk, clerks, etc.) Administrative and executive salaries Interest on resort purchase Advertising Housekeeping Depreciation on reservations computer Room maintenance Carpet-cleaning contract Contract to repaint rooms Revenue (000m) Square feet Rooms Assets (000) $ 12,700 5,900 4,900 600 3,900 80 1,270 50 590 29,990 Pine Valley $ 9,550 Total $ 51,320 303,270 448 65,325 86 $ 108,745 $ 161,03085,205 $67,725 $ 422,705 Oak Glen Mimosa $14,270 $ 15,810 90,205 49,195 122 66 Birch Glen $ 11,690 98,545 174 Required: 1. Based on annual revenue, what amount of the central office costs are allocated to each resort? 2. Suppose that the current methods were replaced with a system of four separate cost pools with costs collected in the four pools allocated on the basis of revenues, assets invested in each resort, square footage, and number of rooms, respectively. Which costs should be collected in each of the four pools? 3. Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort?

Woodland Hotels Incorporated operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the resort: Pine Valley, Oak Glen, Mimosa, and Birch Glen. Woodland allocates its central office costs to each of the four resorts according to the annual revenue the resort generates. For the current year, the central office costs (000s omitted) were as follows: Front office personnel (desk, clerks, etc.) Administrative and executive salaries Interest on resort purchase Advertising Housekeeping Depreciation on reservations computer Room maintenance Carpet-cleaning contract Contract to repaint rooms Revenue (000m) Square feet Rooms Assets (000) $ 12,700 5,900 4,900 600 3,900 80 1,270 50 590 29,990 Pine Valley $ 9,550 Total $ 51,320 303,270 448 65,325 86 $ 108,745 $ 161,03085,205 $67,725 $ 422,705 Oak Glen Mimosa $14,270 $ 15,810 90,205 49,195 122 66 Birch Glen $ 11,690 98,545 174 Required: 1. Based on annual revenue, what amount of the central office costs are allocated to each resort? 2. Suppose that the current methods were replaced with a system of four separate cost pools with costs collected in the four pools allocated on the basis of revenues, assets invested in each resort, square footage, and number of rooms, respectively. Which costs should be collected in each of the four pools? 3. Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Suppose that the current methods were r pools allocated on the basis of revenues, Which costs should be collected in each of Allocation Base Revenue Square feet Number of rooms Assets Show Transcribed Text Allocation Base Revenue Square feet Number of rooms. Assets Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort? (Do n calculations. Enter your answers in thousands rounded to the nearest dollar.) Pine Valley Oak Glen Total cost allocated G $ Total 0 $ Mimosa 0 $ Birch Glen $ $ Total 0 0 0 0 0
Transcribed Image Text:Suppose that the current methods were r pools allocated on the basis of revenues, Which costs should be collected in each of Allocation Base Revenue Square feet Number of rooms Assets Show Transcribed Text Allocation Base Revenue Square feet Number of rooms. Assets Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort? (Do n calculations. Enter your answers in thousands rounded to the nearest dollar.) Pine Valley Oak Glen Total cost allocated G $ Total 0 $ Mimosa 0 $ Birch Glen $ $ Total 0 0 0 0 0
Woodland Hotels Incorporated operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the resort: Pine Valley, Oak Glen, Mimosa, and Birch Glen. Woodland allocates its central office costs to each of the four resorts according to the annual revenue the resort generates. For the current year, the central office costs (000s omitted) were as follows: Front office personnel (desk, clerks, etc.) Administrative and executive salaries Interest on resort purchase Advertising Housekeeping Depreciation on reservations computer Room maintenance. Carpet-cleaning contract Contract to repaint rooms Revenue (000) Square feet Rooms Assets (000s) Pine Valley $ 9,550 65,325 86 Oak Glen $ 14,270 90,205 122 $ 108,745 $ 161,030 $ 12,700 5,900 4,900 600 3,900 80 1,270 50 590 $ 29,990 Allocated cost Mimosa $ 15,810 49,195 66 Birch Glen $ 11,690 98,545 174 $ 85,205 $ 67,725 $ 422,705 Total $ 51,320 303,270 448 Required: 1. Based on annual revenue, what amount of the central office costs are allocated to each resort? 2. Suppose that the current methods were replaced with a system of four separate cost pools with costs collected in the four pools allocated on the basis of revenues, assets invested in each resort, square footage, and number of rooms, respectively. Which costs should be collected in each of the four pools? 3. Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort? Show Transcribed Text Based on annual revenue, what amount of the central office costs are allocated to each resort? ( calculations. Enter your answers in thousands rounded to the nearest dollar.) Pine Valley Oak Glen $ 4,213 $ 6,296 Ċ $ Mimosa Birch Glen 6,974 $ 5,156 $ Total 22,639
Transcribed Image Text:Woodland Hotels Incorporated operates four resorts in the heavily wooded areas of northern California. The resorts are named after the predominant trees at the resort: Pine Valley, Oak Glen, Mimosa, and Birch Glen. Woodland allocates its central office costs to each of the four resorts according to the annual revenue the resort generates. For the current year, the central office costs (000s omitted) were as follows: Front office personnel (desk, clerks, etc.) Administrative and executive salaries Interest on resort purchase Advertising Housekeeping Depreciation on reservations computer Room maintenance. Carpet-cleaning contract Contract to repaint rooms Revenue (000) Square feet Rooms Assets (000s) Pine Valley $ 9,550 65,325 86 Oak Glen $ 14,270 90,205 122 $ 108,745 $ 161,030 $ 12,700 5,900 4,900 600 3,900 80 1,270 50 590 $ 29,990 Allocated cost Mimosa $ 15,810 49,195 66 Birch Glen $ 11,690 98,545 174 $ 85,205 $ 67,725 $ 422,705 Total $ 51,320 303,270 448 Required: 1. Based on annual revenue, what amount of the central office costs are allocated to each resort? 2. Suppose that the current methods were replaced with a system of four separate cost pools with costs collected in the four pools allocated on the basis of revenues, assets invested in each resort, square footage, and number of rooms, respectively. Which costs should be collected in each of the four pools? 3. Using the cost pool system in requirement 2, how much of the central office costs would be allocated to each resort? Show Transcribed Text Based on annual revenue, what amount of the central office costs are allocated to each resort? ( calculations. Enter your answers in thousands rounded to the nearest dollar.) Pine Valley Oak Glen $ 4,213 $ 6,296 Ċ $ Mimosa Birch Glen 6,974 $ 5,156 $ Total 22,639
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