There are several methods for allocating service department costs to production departments. The method which recognizes service provided by one service department to another but does not recognize reciprocal interdepartmental service is called: (CMA adapted)
A) Direct method.
B) Variable method.
C) Linear method.
D) Step method.

Question

Quizplus · Accepted Answer

The step method allocates service department costs to other service departments and production departments in a sequential manner, recognizing some interdepartmental services but not fully reciprocal services.

There Are Several Methods for Allocating Service Department Costs to Production