Revenue allocation, bundled products. Yves Parfum Company blends and sells designer fragrances. It has a Men's Fragrances
Question:
Revenue allocation, bundled products. Yves Parfum Company blends and sells designer fragrances. It has a Men's Fragrances Division and a Women's Fragrances Division, each with different sales strategies, distribution channels, and product offerings. Yves is now considering the sale of a bundled product consisting of a men's cologne and a women's perfume. For the most recent year, Yves reported the following:
Required1. Allocate revenue from the sale of each unit of L'Amour to Monaco and Innocence using the following:a. The stand-alone revenue-allocation method based on selling price of each productb. The incremental revenue-allocation method, with Monaco ranked as the primary productc. The incremental revenue-allocation method, with Innocence ranked as the primary productd. The Shapley value method, assuming equal unit sales of Monaco and Innocence2. Of the four methods in requirement 1, which one would you recommend for allocating L'Amour's revenues to Monaco and Innocence?Explain.
DistributionThe word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...
Step by Step Answer:
Revenue allocation bundled products 1a Under the stand alone revenueallocation method based on selling price Monaco will be allocated 30 of all revenu...View the full answer
Cost Accounting A Managerial Emphasis
ISBN: 978-0132109178
14th Edition
Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav
