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Konig Enterprises, Ltd., owns and operates three restaurants in Vancouver, B.C. The company allocates its fixed administrative expenses to the three restaurants on the basis of sales dollars. Last year the fixed administrative expenses totaled $800,000 and were allocated as follows: Rick's Harborside $21,000,000 42% $ 336,000 Total sales-Last Year Percentage of total sales Allocation based on the above percentages) Restaurants Imperial Garden $14,000,000 28% $ 224,000 Ginger Wok $15,000,000 30% $ 240,000 Total $50,000,000 100% $ 800,000 This year the Imperial Garden restaurant increased its sales by $1 million. The sales levels in the other two restaurants remained unchanged. The company's sales data for this year were as follows: Restaurants Imperial Garden $15,000,000 30% Rick's Harborside $21,000,000 41% Ginger Wok $15,000,000 29% Total sales-This Year Percentage of total sales Total $51,000,000 100% Fixed administrative expenses for this year remained unchanged at $800,000. Required: 1. Using sales dollars as an allocation base, show the allocation of the fixed administrative expenses among the three restaurants for this year. 2. Calculate the change in each restaurant's allocated cost from last year to this year. 3. Is sales dollars a good base for allocation of fixed costs? 1. Using sales dollars as an allocation base, show the allocation of the fixed administrative expenses among the three restaurants for this year. 2. Calculate the change in each restaurant's allocated cost from last year to this year. (Negative amounts should be indicated by a minus sign.) Show less Rick's Imperial Garden Harborside Total Ginger Wok 1. Fixed administrative expense allocation - current year 2. Change in allocated cost

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