ACCT 202 Lecture 28: 4-08 decentralization - measuring accountability-1 (1)
Document Summary
To understand the importance and role of intra-company charge rates within an. To understand the importance of holding users accountable for their usage of organizationally provided services. To understand how we determine what level of income that should be used for organization. evaluating divisional performance. Crane corp. has a centralized employee travel department which handles travel arrangements for the east, central and west divisions of the company. Budgeted annual costs for operating the travel department are ,000. On a preliminary basis, 900 reservations were estimated for 2015. The following actual numbers of reservations were made: The charge rates were determined based on an estimate of 900 reservations, yet only 800 were actually made. How much will each division be charged for evaluation purposes: east, central, west. Montclair airlines, inc. has two divisions organized as profit centers, the passenger division and the cargo division. The service department charge rate for the service department costs was based on revenues.
