The Wilson Manufacturing Company Uses the Step-Down Method for Allocating

question 18

Multiple Choice

The Wilson Manufacturing Company uses the step-down method for allocating support costs and the company has three support departments, Maintenance, Human Resources, and Cafeteria. Assuming that the company allocates costs in that same order, the costs allocated from the cafeteria to line departments and final projects will include:

• A) Maintenance, cafeteria and human resource costs
• B) Only cafeteria costs
• C) Only cafeteria and human resource costs
• D) Only human resource and maintenance costs

---

Definitions:

Regression Analysis

A statistical method for estimating the relationships among variables, often used to predict the value of one variable based on others.

Independent Variables

Variables in an experimental setup that are changed or controlled to test their effects on dependent variables.

Observations

The individual data points or recorded measures of variables collected during a research study or experiment.

Estimated Regression Equation

A mathematical formula predicting the relationship between the dependent variable and one or more independent variables, derived from regression analysis.