Answer the following question(s)using the information below:
Elmo's Educational Software Outlet sells two or more of the video games as a single package.Managers are keenly interested in individual product profitability figures.Information pertaining to three bundled products and the stand-alone prices is as follows:
Assume Reading Fun is the primary product, followed by Math Fun, and then Analysis.
-Using the stand-alone method with selling price as the weight for revenue allocation, what amount of revenue will be allocated to Reading Fun in the first package (Reading Fun & Math Fun)?

Question

Answer the following question(s)using the information below:
Elmo's Educational Software Outlet sells two or more of the video games as a single package.Managers are keenly interested in individual product profitability figures.Information pertaining to three bundled products and the stand-alone prices is as follows:
  Assume Reading Fun is the primary product, followed by Math Fun, and then Analysis.
-Using the stand-alone method with selling price as the weight for revenue allocation, what amount of revenue will be allocated to Reading Fun in the first package (Reading Fun & Math Fun)?

Quizplus · Accepted Answer

The stand-alone method allocates revenue based on the proportion of each product's selling price to the total selling price of the package. If Reading Fun's selling price is $40 and Math Fun's is $60, the total is $100. Reading Fun's proportion is $40/$100, so $40 is allocated to it.

Answer the Following Question(s)using the Information Below