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The direct method of departmental cost allocation is the simplest of the three methods because it:
Multiple Choice
Ignores the reciprocal flows.
Correct
Uses the service flows only to service departments.
Uses a sequence of steps to allocate service department costs.
Doesn’t require any calculations.
All of these answer choices are correct.
Ignores the reciprocal flows.
$102,222.
$122,402.
$127,778.
$142,471.
$150,050.
$127,778.
Multiple Choice
$100,000.
$109,000.
$126,000.
$130,000.
$135,000.
$130,000.
The departmental approach of cost allocation recognizes that the typical manufacturing operation involves which type(s) of departments?
Multiple Choice
Service departments and production departments.
Correct
Production departments and assembly departments.
Joint product departments and separable departments.
Cost pools and cost objects.
Support departments and other service departments.
Service departments and production departments.
The mathematical technique that underlies the reciprocal cost allocation method is:
Multiple Choice
Regression analysis.
Simultaneous equations.
Correct
Analysis of variances.
Complex algebraic functions.
Multiple correlation.
Simultaneous equations.
Multiple Choice
$1,287,500.
$2,170,000.
$882,500.
$842,500.
$889,166.
$882,500.
