Your Expert (YE) produces and markets DVDs for sale to the business community. It hires…

Your Expert (YE) produces and markets DVDs for sale to the business community. It hires well-known business speakers to present new developments in their area of expertise in DVD format. The compensation paid to each speaker is individually negotiated. It always has a component based on the percentage of revenues from the sale of the DVD, but that percentage is not uniform across speakers. Moreover, some speakers negotiate separate fixed-dollar payments or multiple-DVD deals.

YE sells most DVDs as separate items. However, there is a growing trend for DVDs also to be sold as part of bundled packages. YE offered bundled packages of its three best-selling DVDs in 2015. Individual and bundled sales of these three DVDs for 2015 are:

Required

1. Allocate the bundled product revenues to the individual DVDs using the stand-alone revenue allocation method (using selling prices as the weights).

2. Describe (without computations) an alternative method of allocating the bundled product revenue to that in requirement 1.

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