Actual costs should always be used when allocating service department costs.

Name: Actual costs should always be used when allocating service department costs.
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Question

Quizplus · Accepted Answer

Actual costs may not always accurately reflect the actual usage of the service departments by other departments in the organization. Instead, allocation of service department costs is often based on estimated or budgeted costs that can better reflect the usage patterns and needs of other departments.

Actual Costs Should Always Be Used When Allocating Service Department