The system was designed and constructed based on the anticipated number of hours of usage required by the various departments, according to department managers' projections. Since the capacity is being provided based on anticipated usage, the cost should be allocated the same way.
The system was designed and constructed based on the anticipated number of hours of usage required by the various departments, according to department managers' projections. Since the capacity is being provided based on anticipated usage, it would not be appropriate to allocate the cost a different way. Furthermore, allocating costs equally to each department is seldom a good way to do it because it does not recognize the differences in the individual departments' usages.
The system was designed and constructed based on the anticipated number of hours of usage required by the various departments, according to department managers' projections. Since the capacity is being provided based on anticipated usage, it would not be appropriate to allocate the cost a different way. Furthermore, basing cost allocations on revenue generated is seldom a good way to allocate costs, because it discourages department managers from increasing their revenues.
The system was designed and constructed based on the anticipated number of hours of usage required by the various departments, according to department managers' projections. Since the capacity is being provided based on anticipated usage, it would not be appropriate to allocate the cost a different way.
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