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(Solved by Expert Tutors) 2. (TCO 6) Booth Financial Services, LLC has two revenue producing depar


Consulting. The accounting department is trying to determine the best method to allocate $1,000,000 of common costs (secretarial staff, reception personnel, etc), either by salary or number of employees. Information on the revenue departments are as follows:DepartmentEmployeesSalariesFinancial Planning150 employees$10,000,000Business Consulting50 employees$5,000,000(a) Allocate the $1,000,000 common costs to the two revenue departments using both methods.(b) Why are allocations called arbitrary?

 


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Apr 19, 2020

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