Harribo Inc. has two departments : Department A and Department B. Each department has considered renting...
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Harribo Inc. has two departments : Department A and Department B. Each department has considered renting a plane to use to travel around the US and increase its business. If Department A rents the airplane itself, it will use 1500 hours for the year. Department B plans to use the plane for 2500 hours for the year. Renting the plane for the entire year will cost Harribo $14,000,000 If each department rents the airplane by itself, the hourly rate is $5,000 /hour. 1) What is the discounted price for Department A and B going together to rent the plane for the year? 2) If Harribo allocates the cost of the plane using the Stand Alone Method, how much of the cost is allocated to Department A? You should round to 3 decimal places when calculating 3) If Harribo uses the Incremental Cost Method and Department B is the primary user, how much of the cost is allocated to Department A?
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Answer rating: 100% (QA)
1 Discounted Price for Departments A and B Going Together Department A hourly rate 5 000 per hour De View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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