Question

Chilton Day School allocates marketing and administrative costs to its three schools based on total annual tuition revenue for the schools. Last year the allocations (000s omitted) were as follows: Preschool Middle School High School Total Tuition revenue $ 1,590 $ 1,890 $ 2,290 $ 5,770 Marketing and administration 320 370 445 1,135 In the current year, the middle and high schools experienced no change in revenues, but the preschool’s tuition revenue increased to $1.99 million. Marketing and administrative costs rose to $1,340,000. Required: 1. Using revenue as an allocation base, how should the costs be allocated for the current year? (Do not round intermediate calculations. Enter your dollar answers in thousands rounded to 2 decimal places.)

Solve for cost allocation: preschool, middle school, high school, and total

Answer 1

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