One answer to the problem of using a single cost driver to allocate support activity costs is to use a dual-rate allocation.

Question

Quizplus · Accepted Answer

A dual-rate allocation method separates the support activity costs into fixed costs and variable costs, and allocates them based on different cost drivers. This helps to better reflect the cause-and-effect relationship between the support activities and the products/services they support.

One Answer to the Problem of Using a Single Cost