Allcott Computer Services (ACS) provides computer training and repair services for schools and local businesses. Sales for year 1 totaled $1,350,000. Information regarding resources for the year includes the following:

In addition, ACS spent $42,000 on 500 repair verifications with a cost driver rate of $75.

Required
Management has requested that you do the following:
a. Prepare a traditional income statement.
b. Prepare an activity-based income statement.
c. Write a short report to management explaining why the activity-based income statement provides useful information to managers. Use the information from requirements (a) and (b) to develop examples for yourreport.

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Resources Used Resources Supplied $112,000o rketing Depreciation Training personnel -.-- Energy..--- Short-term labor 87,000 45,000 80,000 225,000 415,000 70,000 $120,000 89,500 54,000 85,500 310,000 425,000 79,000 Administrative