Liberty Credit Checks Produces Two Styles of Credit Reports: Personal

question 110

Essay

Liberty Credit Checks produces two styles of credit reports: personal and corporate.The difference between the two is the amount of background information and data collection required.The corporate report uses more skilled personnel because additional checking and data are required.The relevant figures for the year just completed follow: Total support service costs to be allocated are $3,200,000. $$\begin{array} { | l | r | r | } \hline \text { Allocation base } & \text { Indlvidual } & \text { Corporate } \\\hline \text { Data purchased } & \$ 40,000 & \$ 80,000 \\\hline \text { Research hours } & 24,000 & 30,000 \\\hline \text { Interview hours } & 1,000 & 10,000 \\\hline \text { Number of reports } & 16,000 & 3,000 \\\hline\end{array}$$ Required:
(a)Which method would be preferred by each manager? Which method would be least preferred?
(b)Provide arguments that each manager would make for his/her preferred method.How would each manager argue against his/her least preferred method?

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Definitions:

Strenuous Physical

Strenuous physical activities involve intense or vigorous effort that requires considerable energy and endurance.

Short Naps

Brief periods of sleep, generally lasting less than 30 minutes, intended to quickly restore alertness and performance.

Insomnia

Recurring problems in falling or staying asleep.

Delta Waves

Slow brainwaves predominantly associated with deep sleep and restorative processes in the brain.