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Northern Regional Healthcare Foundation has two fundraising/operating divisions- Corporate and foundation fundraising and Individual fundraising division-and two support divisionsHuman Resources and Information Systems. Each fundraising
Northern Regional Healthcare Foundation has two fundraising/operating divisions- Corporate and foundation fundraising and Individual fundraising division-and two support divisionsHuman Resources and Information Systems. Each fundraising division conducts their own events independently. Northern Regional uses number of employees to allocate Human Resources costs and processing time to allocate Information Systems costs. The following data are available for September 2020: Support Divisions Operating Divisions Human Information Corporate Individual Resources Systems foundation fundraising $582,700 $734,400 $998,270 $689,860 Budgeted costs incurred before any interdivision cost allocations Support work supplied by Human Resources Division Budgeted number of employees - 21 32 48 Support work supplied by Information Systems Division Budgeted processing time (in minutes) 320 - 1,920 2,600 Required Allocate the support divisions' costs to the operating divisions using the direct method. Rank the support divisions based on the percentage of their services provided to other support divisions. Use this ranking to allocate the support divisions' costs to the operating divisions based on the step-down method. Allocate the support divisions' costs (Human Resources and Information Systems) to the two fundraising/operating divisions using the reciprocal method. The board would like you to comment on which method should the hospital use to allocate the supporting divisions and the effectiveness of the two main fundraising division
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