The algebraic method
A)considers all interrelationships of the departments and reflects these relationships in equations.
B)does not consider interrelationships of the departments nor reflect these relationships in equations.
C)is also referred to as the "benefits-provided" ranking method.
D)is not a service department cost allocation methoD.

Question

Quizplus · Accepted Answer

The algebraic method takes into account all interrelationships between service departments and reflects these relationships in equations to allocate their costs to other departments. Thus, option A is the correct answer. Option B is incorrect as it denotes the direct method of cost allocation, which does not consider interrelationships. Option C is incorrect as it refers to the "benefits-received" method, while option D is incorrect as the algebraic method is a service department cost allocation method.

The Algebraic Method