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Cost allocation scheme

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Assume that $2 mil of Financial Services are related to billing and managerial reporting and $1 mil are related to payroll and personnel management activities.

a. Devise and implement a cost allocation scheme that recognizes that Financial Services has two widely different functions?

b. Is there any additional information that would be helpful in completing part a?

c. What are the costs and benefits to St Mary's of creating two cost pools for Financial Services?

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Solution Summary

The solution explains how to develop a cost allocation scheme