Mesa Telcom Has Three Divisions, Commercial, Retail, and Consumer, That

question 83

Multiple Choice

Mesa Telcom has three divisions, commercial, retail, and consumer, that share the common costs of the company's computer server network. The annual common costs are $2,400,000. You have been provided with the following information for the upcoming year:
$$\begin{array} { | l | r | r | } \hline & \text { Connections } & { \text { Time on Network (hours) } } \\\hline \text { Commercial } & 60,000 & 120,000 \\\hline \text { Retail } & 80,000 & 150,000 \\\hline \text { Consumer } & 100,000 & 330,000 \\\hline\end{array}$$
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The cost accountant determined $1,700,000 of the server network's costs were fixed and should be allocated based on the number of connections. The remaining costs should be allocated based on the time on the network. What is total server network costs allocated to the Retail Division (rounded to the nearest whole dollar) , assuming the company uses dual-rates to allocate common costs?

• A) $741,667.
• B) $657,143.
• C) $425,000.
• D) $211,765.

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Definitions:

Positive Reinterpretation

A coping strategy involving the reframing of a negative event or situation in a positive light to manage stress and maintain well-being.

Positive Reinterpretation

The process of reframing an event or situation in a positive light to manage stress or hardship.

Cutting Your Losses

A decision-making process where one decides to exit a situation to prevent further loss or harm.

Stress-Producing Problem

An issue or situation that causes a significant amount of mental or emotional strain, often leading to adverse effects on one’s health and well-being.