Question

Pick a cost that you think should be shared by all divisions or a cost that you think should not be shared by all divisions and list the pros and cons of your choice. If you would allocate the cost what base would you use, and pros and cons of that choice.

Answer 1

Human resource management(HRM) cost is being considered for the relevant discussion.

It is the cost which is being incurred to ensure that there is the proper management of most important resource of the organisation which is colleagues of any organisation.

The purpose of HRM is to maximize the productivity of the organisation by optimum effectiveness of the colleagues.

Pros :-

This will increase the efficiency of the colleagues. Hence, it will lead to more productivity.

This will help in prodcucting more outputs.

This will help in wastage of time and resources.

Cons :-

This will be an additional cost to the organsiation as whole.

This will be allocated on the basis of man hours basis. However, it will increase the cost of each department.

This will be more useful where white collar jobs are performed.