The Direct Method of Departmental Cost Allocation Is the Simplest

question 12

Multiple Choice

The direct method of departmental cost allocation is the simplest of the three methods because it:

• A)Ignores the reciprocal flows.
• B)Uses the service flows only to service departments.
• C)Uses a sequence of steps to allocate service department costs.
• D)All of the above.

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Definitions:

Multiple Products

Offering a range of different goods or services within a business's portfolio to cater to various customer preferences or market segments.

Multiple Market Segments

The practice of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups with similar needs or characteristics.

Geographic Markets

Market segments defined by geographic areas where customers share similar needs and characteristics.

Increased Sales

An upward trend in the quantity of products or services sold, indicating growth in revenue for a business.