ACC MOD 4 SLP - Allocated costs

Running head: ACCMOD4SLP
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` Introduction
Allocated costs are costs proportionally assigned to costs that result from a cause while unallocated costs are costs that represent corporate that are not associated or linked to the provision of a service or product by the company. It is important for any organization to ensure that resource allocation is done equitably. This is to ensure that the departments within the organization are up and running that guarantees the organization good returns at the end of the day. Temporary Assistance for Needy Families (TANF) is an organization that deals with the welfare for children and families that are less privileged in the society. We are going to examine how they allocate resources to the various departments within their organization (Stevenson, 2002).
TANF as an organization allocates its direct costs to wages, benefits, provisions and many more. It includes things like sponsoring of projects, instructional materials and patient care activities. In simple terms they are the material and labor costs meant for specific assets and items. In this method, the transfer of the costs of services in a department is directed straight to the productive departments. Indirect fixed costs include the common management overheads of the organization e.g. the general organizations set up, the staff, amenities, the security, information assistantship etc. They are intangible in nature (Steven, 2007). Cost allocation is more often than not conducted in several of steps. The first step is where costs are assigned to products and services in the operating department. In the second stage products and services that had been allocated in the operating department are now allocated to product and services. During the first stage, service department costs are allocated to operating departments based on allocation base. For instance, the number of meals eaten in the cafeteria will deter...