Gerterai see divsions: One, Two, and Three. Corporate headquarters 1s 24) headquarters incurs costs of $20,000,000 per period, which is an indirect cost of the divisions. Corporate endquarters currently allocates this cost to the divisions based on the revenues of each division. The CEO has each division manager to suggest an allocation base for the indirect headquarters costs from among, revenues, costs, and number of employees. The following is relevant information about each division f each division. The CEO has asked ues, direct One Two Three Revenues Direct costs Segment margin Number of employees Required: s25,000,000 $ 27,000,000 22,000,000 16,000,000 6,000,000 6,000 17,000,000 14,000,000 13,000,000 $ 8,000,000 $ 7,000 13,000 1. Allocate the indirect headquarters cost of General Manufacturing to each of the three divisions using revenues Calculate operating margins for each division direct costs, and number of employees as the allocation bases. after allocating headquarters costs. Which allocation base do you think the manager of the Two division would prefer? Explain. 2