Pricing Police case

Case analysis:

1.Which cost allocation model, old or proposed, would you recommend to Doran as the most equitable solution for all municipalities? Explain. (10 marks)
2.Do you believe any other models using a single cost driver are fairer than Doran’s proposed billing model? Explain why or why not? (10 marks)
3.How would you explain your recommendation to the mayor of Alder and are there any further actions you could take to ensure that the mayor supports your recommendation? (5 marks)
Provide any qualitative and/or quantitative information necessary to support your recommendations. In making your recommendations, please refer to what you consider relevant costing models.

Sample Solution