Solution-Allocate the fixed cost to each restaurant

Allocate the fixed cost to each restaurant

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Reference no: EM132621095

Three restaurants in a downtown area of a large city have decided to share a valet service and parking lot to their customers. the cost of the service and lot is $10,000 per month. the owners of the restaurants need to decide how to divide the $10,000 cost. the actual usage, planned usage, and practical capacity in the month of may was:

RESTAURANT ACTUAL PARKING SPOTS USED PLANNED PARKING SPOTS PRACTICAL CAPACITY PARKING SPOTS

A 1,500 1,600 2,000

B 1,400 1,300 1,500

C 1,300 1,100 1,500

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Problem 1: Allocate the fixed cost to each restaurant using actual, planned and capacity usage measures. which method of allocation makes more sense?

Reference no: EM132621095

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Allocate the fixed cost to each restaurant

Reference no: EM132621095

Reference no: EM132621095

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