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Lucy Smole, controller of the Wonderful Snacks, is preparing a presentation to senior executives about the performance of its four divisons.

Lucy Smole, controller of the Wonderful Snacks, is preparina a presentation to senior executives about the performance of its four divisions. Summary d (Click the icon to view the summary data. (Click the icon to view more information.) The components of corporate costs for the most recent year and Smole's suggested cost pools and allocation bases are as follows: (Click the icon to view the suggested cost pools and allocation bases.) Read the requirements. Requirement 1. Select two reasons why Wonderful Snacks should allocate corporate costs to each division. A. To provide information for economic decisions. B. To determine the likelihood of customer retention. C. Income measurement for external parties. D. To quantify the potential for sales growth. Requirement 2. Calculate the operating income of each division when all corporate costs are allocated based on revenues of each division. (Round allo or parentheses.) More info Under the existing accounting system, costs incurred at corporate headquarters are collected in a single cost pool (\$1 million in the most recent year) and allocated to each division on the basis of its actual revenues. The top managers in each division share in a division-income bonus pool. Division income is defined as operating income less allocated corporate costs. Smole has analyzed the components of corporate costs and proposes that corporate costs be collected in four cost pools

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