At Williams Corp., all indirect costs are allocated by accounting. One department manager obtained records for her department of allocation rates and actual charges for the prior 3 months and estiĀ­mates for this and next month (May and June; see the table). The basis of allocation is not indicated, and the company accountant would not share the basis used. However, the accountant advised the manager to not be concerned, since it is a good sign when the allocation rates decrease each month.


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