Konig Enterprises, Ltd., owns and operates three restaurants in Vancouver, B.C. The company allocates its...
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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. During 2008, the fixed administrative expenses totaled $860,000. These expenses were allocated as follows Restaurants Ginger Wok $1,449,000 $4,221,000 $6,300,000 67% $ 197,800 576,200 860,000 Ricks's Harborside Imperial Garden Total Total sales-2008 Percentage of total sales Allocation(based on the above percentages) $630,000 10% 23% 100% $ 86,000 During 2009, the following year, the Imperial Garden restaurant increased its sales by $2 million. The sales levels in the other two restaurants remained unchanged. The company's 2009 sales data were as follows Restaurants Imperial Garden 40% Ginger Wok $4,184,460 54% Total $7,749,000 100% Ricks's Harborside $3,099,600 Total sales--2009 Percentage of total sales $464,940 6% Fixed administrative expenses remained unchanged at $860,000 during 2009
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