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Unformatted text preview: 10-18 If the hotel raises the prices during the winter when the demand for rooms is low, it will result in even fewer rooms being booked and even lower profits. It would be better to raise prices when the rooms are in high demand because people will be willing to pay more during those times. 11-17 I would recomend that the step method be used for cost allocation. The step method would take into account that some service department costs can be allocated to other service departments. I would first allocate costs from the computer support department because their services would be utilized by both of the other departments. Then I would allocate costs from the library department because their services could be utilized by carreer development. It would be best to choose different allocation bases for wach department beacuse a straight number of students allocation does not seem appropriate for all service departments. The step method would be most appropriate because computer department services are used by the other two service departments but the computer department probably does not use the services of the others. If that were the case then the reciprical method would be more appropriate. ...
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This note was uploaded on 08/14/2011 for the course ACC 310 taught by Professor Parker during the Spring '11 term at Ashford University.
- Spring '11