Author Question: Which of the following statements is false with regards to departmental cost allocations? (Read 117 times)

fnuegbu · **on:** Mar 6, 2021

Question 1

Which of the following is one of the methods of allocating support department costs to operating departments that partially recognizes mutual service provided among all support departments?
◦ dual-cost allocation method
◦ direct method
◦ sequential allocation method
◦ single-rate cost allocation method

Question 2

Which of the following statements is false with regards to departmental cost allocations?
◦ amounts allocated to departments will most likely differ depending on the cost allocation method used
◦ the total amount allocated among departments will differ in total depending on the cost allocation method used
◦ the reciprocal method is usually the most conceptually precise method because it considers mutual services provided among all support departments
◦ the step-down and direct methods are simple for managers to compute and understand relative to the reciprocal method

vseab · **Reply #1 on:** Mar 6, 2021

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