Write a two page memorandum to NMC upper management in regards to the attached scenario, that outlines weaknesses in their current cost allocation process and ways to improve it that will assist them in evaluating the performance of the Classic and New Wave divisions. Be sure to discuss manager incentives for manipulating allocation methods to influence performance measures. Be sure to pay particular attention to the impact on product costing that the overall manufacturing philosophy is driving and its unintended/secondary effects on managerial performance.
Memorandum to NMC upper management
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