Seaside Resorts Operates a Centralized Call Center for the Reservation

question 103

Essay

Seaside Resorts operates a centralized call center for the reservation needs of its time-share units.Costs associated with use of the center are charged to the time-share group (Luxury and Standard)where a reservation is made on the basis of time spent on a call.Due to recent increased competition in the time-share business,the company has decided that it is necessary to more accurately allocate its costs to price its services competitively and profitably.During the current period,the use of the call center for each group was as follows (in thousands of seconds for time usage and in number of reservations): $$\begin{array} { | l | r | r | } \hline \text { Disision } & \text { Time Usage } & \text { Number of Resewations } \\\hline \text { Luxury } & 500,000 & 50,000 \\\hline \text { Standard } & 2,000,000 & 300,000 \\\hline\end{array}$$
During this period,the cost of the computer center amounted to $1,220,000 for personnel and $960,000 for equipment and other costs.Required:
Determine the allocation to each of the divisions using (round all decimals to three places):
a.a single rate based on time used.b.multiple rates based on time used (for personnel costs)and number of reservations (for equipment and other cost).

---

Definitions:

Internalization of Schemes

The process through which children absorb and integrate external behaviors or cultural practices into their own cognitive frameworks during development.

First Intentionality

The initial phase of developing the ability to attribute intentions to others and oneself, fundamental in understanding social interactions.

Primitive Symbolic Utilization

The basic use of symbols or objects to represent ideas, thoughts, or entities, often observed in early childhood development.

First Schemes

Early cognitive structures in Piaget’s theory of cognitive development, representing patterns of behavior or thinking that children use to explore and engage with the world.