If two service departments service the same number of departments, which service department's costs should be allocated first when using the step method?
A) The service department that provides the most service to other service departments.
B) The service department that provides the most service to the user departments.
C) The service department with the least cost.
D) The service department that provides the least service to other service departments.

Question

Quizplus · Accepted Answer

In the step method, the service department that provides the most service to other service departments is allocated first to ensure that the interdepartmental services are accounted for before allocating costs to user departments.

If Two Service Departments Service the Same Number of Departments