Allocating actual service department costs allows the service departments to pass on the costs of inefficiencies to the production departments.

Question

Quizplus · Accepted Answer

Allocating actual service department costs means that the production departments are charged for the true costs incurred by the service departments, including any inefficiencies or additional costs. This allows the service departments to pass on those costs to the production departments, encouraging them to operate more efficiently and effectively.

Allocating Actual Service Department Costs Allows the Service Departments to Pass