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Unformatted text preview: have division revenues be the allocation base when the amount of interest each divison incurs is actually based on the assets they own. The multiple cost pools spreads the costs based on cost drivers that best demonstrate the cause-and-effect relationship between each activity and the costs in the related cost pool. The incremental operating income is positive for each divison except for the Eastern one (though it still is the most profitable) thus more beneficial then the single cost pool....
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- Spring '11