Gordon Gecco Furniture Company has two major product lines with the following characteristics:
Commercial office furniture: Few large orders, little advertising support, shipments in full truckloads, and low handling complexity
Home office furniture: Many small orders, large advertising support, shipments in partial truckloads, and high handling complexity
The company produced the following profitability report for management:

The selling and administrative expenses are allocated to the products on the basis of relative sales dollars.
Evaluate the accuracy of this report and recommend an alternativeapproach.

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Gordon Gecco Furniture Company Product Profitability Report For the Year Ended December 31, 2014 Commerdal Office Furniture Home Office Furniture Total Revenue Cost of goods sold Gross profit Selling and administrative expenses Income from operations $5,600,000 2,100,000 $3,500,000 1,680,000 $1,820,000 2,800,000 $8,400,000 3,080,000 $5,320,000 2,520,000 $2,800,000 980,000 1,820,000 840,000 980,000