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May 19, 2022 at 9:37 PM

Movie theater cost allocation

For this team problem, your task is to help a large movie theater set up an expense allocation system. Each member of your team will describe an allocation system for one of these four expense categories: (1) heating/air conditioning; (2) rent; (3) insurance; or (4) employees wages. Complete instructions are below

Use your Group's Announcements area to discuss and agree on who on your team will analyze which cost category: heat/AC, rent, insurance, or employees wages.

In your Group's Discussion forum, individually propose an expense allocation system for your chosen expense category (heat/AC, rent, insurance, or wages), and propose how this expense category should be allocated across (a) the various-sized auditoriums, (b) the concessions operations, and (c) the restrooms. It is up to you to determine the appropriate allocation base for each profit or cost center. For full credit, your proposal should be clear and detailed.

IMPORTANT INSTRUCTIONS:

1. Navigate to your Group Homepage by hovering your cursor over our course at the Coursesdropdown menu at the top of this page. Use your Group's Announcement tool to decide among your teammates who will tackle which expense.
2. Once your roles are agreed, post your solution for your chosen expense category (heat/air conditioning, rent, insurance, or maintenance) in your group's Graded discussion forum.
3. For full credit, be sure to provide thoughtful and constructive comments to at least 2 of your teammates.

CHAPTER 24 TEAM PROBLEM

A large regional movie theater has two profit centers (ticket sales and snack concessions) and one cost center (restrooms). The new accounting team has been tasked with setting up a responsibility accounting reporting framework for the theater.

The theater has:

• 16 auditoriums (ten of the auditoriums have 150 seats each; the other six auditoriums each have 400 seats)
• A large concessions area
• Two large restrooms

Required

Propose an expense allocation system for one of the following categories of expenses:

1. Heating/air conditioning
2. Rent
3. Insurance
4. Wages paid to hourly employees (assume that all employees are floaters who share in all theater duties: selling and taking tickets; selling concessions; cleaning auditoriums and restrooms)

In your solution, be sure to explain how your expenses will be allocated to the profit centers (ticket sales and snack concessions) and the cost center (restrooms). The appropriate allocation base(s) are for you to decide.

--> Your solution should be about one paragraph long and does not need to contain any numbers.

for renting

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