Case - Harbor City Electric
1) Are the allocation bases suggested in the case "reasonable"? If not, how would you change them? Which of the two bases under discussion for the maintenance and repair cost center would you use? Why?
2) Should Ms. Conaway appy to the DPU for a rate increase? If so, for which products and approximately how much? If not , how should she go about eliminating the loss? (complete the tables below to help answer these questions)
3) After completion of the tables below, what else would you recommend to Ms. Conaway?
Complete the tables below:
When allocating service center costs, allocate them by starting with the service center that uses the other service centers the least and end with the service center that uses the other service centers the most.
Complete the tables below:
When allocating service center costs, allocate them by starting with the service center that uses the other service centers the least and end with the service center that uses the other service centers the most.
In this case we will use the allocation order below (this determination is made by assumptions and is not explicitly given in the case).
Step 1 Depreciation [1]
Step 2 Maintenance and Repairs
Step 3 General & Admin
Step 4 General cleaning & Upkeep
Step 5 Information Technlolgy
Attachment:- Case.rar