Question #2

Using the work you complete last week on problem P7.3, answer question P7.3B and discuss with you peers.

please I need help with this question

P7.3 You have the following annual information about a restaurant complex consisting of three departments: Contributory Dining Coffee Income Statement Room Shop Lounge Total Sales revenue S194.800 $135,800 $152,800 $483,400 Direct costs 154.400) ( 128.000) ( 124,600) ( 407,000) Contributory income $ 40,400 $ 7,800 $ 28,200 $ 76,400 Indirect costs ( 52,000) Operating income $ 24,400 The owner wants to allocate indirect costs quarterly to each department based on square footage to get a better picture of how each department is doing. Dining room Coffee shop Lounge 2.200 sq. ft. ft. 960 sq. ft. 840 sq. a. Allocate the indirect costs as indicated. b. The owner has an offer from the souvenir store operator who is will- ing to rent the coffee shop space for $9.600 a year. Advise the owner whether to accept the offer