Washington Arts allocates marketing and administrative costs to its three schools based on total annual tuition revenue for the schools: School Longview Campus Springhill Campus Center Saint Campus Total Tuition revenue $ 1,400,000 $ 1,200,000 $ 1,400,000 $ 4,000,000 Marketing and administrative

Washington Arts allocates marketing and administrative costs to its three schools based on total annual tuition revenue for the schools: School Longview Campus Springhill Campus Center Saint Campus Total Tuition revenue $ 1,400,000 $ 1,200,000 $ 1,400,000 $ 4,000,000 Marketing and administrative

Financial & Managerial Accounting

14th Edition

ISBN:9781337119207

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter20: Variable Costing For Management Analysis

Section: Chapter Questions

Problem 20.22EX: Variable costing income statement and contribution margin analysis for a service company The actual...

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Concept explainers

Income Statement

Income Statement also commonly called a profit and loss statement, one of the key financial statements (considered together with balance sheet and cash flow statement) which shows the revenues and expenses, as well as the gains and losses of a company for a given period. In other words, it presents the financial performance/profitability of a business over a specified accounting period.

Question

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Q22

Washington Arts allocates marketing and administrative costs to its three schools based on total annual tuition revenue for the schools:

School	Longview Campus	Springhill Campus	Center Saint Campus	Total
Tuition revenue	$ 1,400,000	$ 1,200,000	$ 1,400,000	$ 4,000,000
Marketing and administrative				$ 1,600,000

Using revenue as an allocation base, the amount of costs allocated to the Springhill Campus is calculated to be:

Multiple Choice

$640,000.
$560,000.
$400,000.
$480,000.
$760,000.

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