The allocation method for support department costs that allocates fixed and variable costs separately is:
A) the direct method
B) the step-down method
C) the reciprocal method
D) the dual-rate method

Question

Quizplus · Accepted Answer

The dual-rate method is the only allocation method listed that separates fixed and variable costs. This method allocates fixed costs based on budgeted usage and variable costs based on actual usage, making it the most accurate method for allocating support department costs.

The Allocation Method for Support Department Costs That Allocates Fixed