Which of the following methods ranks individual products in a bundle for revenue allocation?
A) stand-alone revenue-allocation method
B) incremental revenue-allocation method
C) unit-cost weighting method
D) physical-unit weighting method

Question

Quizplus · Accepted Answer

The incremental revenue-allocation method is the one that ranks individual products in a bundle for revenue allocation based on the additional revenue generated by including each product in the bundle compared to the revenue generated by the previous bundle. Therefore, it is the best choice for this question. The stand-alone revenue-allocation method allocates revenue based on the individual sales of each product in the bundle regardless of the bundle sale, while the unit-cost weighting method and the physical-unit weighting method use different criteria to allocate revenue such as costs or quantity of units sold, respectively.

Which of the Following Methods Ranks Individual Products in a Bundle