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Abstract

This study examines support department cost allocations in the Healthcare Industry. The topic is of current interest to both accountants and to healthcare administrators because of recent innovations in the design of management accounting systems. Using a survey of Georgian healthcare firms, the results indicate that sophisticated support cost methods are used less than may be expected given the complexity of the healthcare firms' operations. This result is documented despite the historical presence of support cost allocations through such industry practice as Medicare cost reports. Respondents indicate that the employment of cost allocation methods is determined internally by the financial management.

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