State Hospital has two service departments (Patient Records and Accounting) and two "production" departments (Internal Medicine and Surgery). Which of the following allocations would not take place under the reciprocal-services method of cost allocation?

Question

Quizplus · Accepted Answer

The reciprocal-services method of cost allocation involves allocating service department costs to other service departments and to production departments, but not allocating costs between production departments themselves (such as from Surgery to Accounting or Internal Medicine to Surgery).

State Hospital Has Two Service Departments (Patient Records and Accounting)