Reference no: EM132564727

Aguila Company has two major segments with the following information:

                                                   Skyscraper                      Ground                   Zero  Total

Annual Revenue                                  P200,000                      P600,000          P800,000

Annual Salesperson Salaries                    P30,000                           P45,000             P75,000

Number of Customers                                 50                               75                    125

Miles Driven                                               80,000                         40,000                120,000

The business also has overhead costs as follows:

Cost pool                   Cost in pool                        Cost driver

Travel                       P36,000                         miles driven

Entertainment                 P144,000                 number of customers

Administrative                   P150,000                       salaries

TOTAL                            P330,000

Required:

Question 1. Allocate the overhead costs to the segments based on sales revenue.

Question 2. Determine the income of each segment.

Question 3. Allocate the overhead costs to the segments using ABC.

Question 4. Determine the income of each segment under ABC.