I am going to focus on the customers of my business and leave cost-allocation issues to my accountant.” Do you agree with this comment by a division president? Why?

Answer:

Disagree. Cost accounting data plays a key role in many management planning and control decisions. The division president will be able to make better operating and strategy decisions by being involved in key decisions about cost pools and cost allocation bases. Such an understanding, for example, can help the division president evaluate the profitability of different customers.