Under the step-down method of allocation:
A) The costs for the support department with the smallest total are allocated first
B) When the second support department's costs are allocated, they are allocated to each of the other departments, but not to the first support department that was allocated.
C) Once a support department's costs have been allocated, it is available for an additional allocation
D) Support department costs are allocated solely to operating departments

Question

Quizplus · Accepted Answer

Under the step-down method of allocation, once a support department's costs are allocated, they are not allocated again, nor are they allocated to other support departments that have already had their costs allocated. This means when the second support department's costs are allocated, they are not allocated to the first support department whose costs have already been allocated, aligning with choice B.

Under the Step-Down Method of Allocation