Distinguish among the three methods of allocating the costs of support departments to operating departments.

Distinguish among the three methods of allocating the costs of support departments to operating departments.



Direct- allocates each support departments costs directly to the operating department.

Step Down allocates support department costs to other support and operating departments in a sequential matter partially recognizing that mutual services provided among all support departments.

Reciprocal- allocates support department costs to operating department by fully recognizing the mutual services provided.


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