The direct, sequential, and reciprocal services methods of allocating support department costs to production departments using ABC require a three-step process.

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Quizplus · Accepted Answer

The direct, sequential, and reciprocal methods are traditional cost allocation methods, not specifically tied to Activity-Based Costing (ABC). ABC typically involves identifying activities, assigning costs to those activities, and then allocating those costs to products or services based on their consumption of activities, which does not directly correspond to the three-step process of the traditional methods mentioned.

The Direct, Sequential, and Reciprocal Services Methods of Allocating Support