Which is not true of the various methods of allocating service department costs?
A)Application of the reciprocal method in a complex corporation usually requires the use of a computer
B)The direct method is quick to compute, accurate, and has low information requirements
C)There are multiple sequence possibilities for the step-down method
D)The choice of method affects the optimal allocation of resources
E)All of the above are true

Question

Quizplus · Accepted Answer

The statement that the direct method is quick to compute, accurate, and has low information requirements is not entirely true. While it is quick to compute and has low information requirements, it may not always lead to accurate results as it does not consider the interdependence of service departments.

Which Is Not True of the Various Methods of Allocating