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22 Sharing the Costs of Human Services Transportation There is some flexibility in assigning expenses to specific expense accounts. Because there are no hard and steadfast rules for assigning expenses, good judgment and an understanding of how expenses are incurred are needed. A good expenses assignment should be Logical and understood by all. Defensible and able to pass scrutiny from an outside observer. Clearly expressed in writing. Consistent so that it is useful for watching cost trends over time. Various methods for assigning expenses can be used provided that they meet these objectives. See Chapter 7 for a recommended method. Summary A comprehensive cost accounting system for transportation services should describe in detail all costs that have been incurred and all services rendered, describe in detail how the funds of all par- ticipating agencies have been spent, and equitably distribute the costs of transportation among the participating agencies by allocating the costs according to services received. To do this, a financial chart of accounts that can track all kinds of expenses related to community transportation ser- vices must be developed. A key element of the chart of accounts is the establishment of expendi- ture classes, each of which should have detailed subcategories. When using a full cost accounting approach, transportation providers should understand that costs may be expressed in a number of different ways. The costs of transportation services may be considered as fixed versus variable costs, capital versus operating costs, or direct versus shared costs. Each paired concept has its own value in understanding how costs are incurred and, therefore, how to better manage transportation services.