In the step-down method,the first service department used in the sequence to allocate service department costs is the department that renders the ________.
A) greatest service as measured by physical capacity
B) greatest service as measured by total employees
C) greatest service as measured by costs to the other service departments
D) greatest service as measured by costs to the producing departments

Question

Quizplus · Accepted Answer

The step-down method allocates the costs of the service department that provides the greatest service, as measured by costs, to the other service departments first. This method recognizes the interdepartmental services provided and allocates costs based on the extent of services rendered.

In the Step-Down Method,the First Service Department Used in the Sequence