168 112 Support department cost allocation Hooligan Adventure Supply produces and sells various outdoor equipment. The Molding and Assembly production departments are supported by the Personnel and Maintenance departments. Personnel costs are allocated to the production departments based on the number of employees, and Maintenance costs are allocated based on number of service calls. Information about these departments is detailed in the following table: Personnel Maintenance Molding Assembly Department Department Department Department Number of employees 28 10 41 49 Number of service calls 57 Department cost $15,000 $11.400 $72,000 $69,000 1. Which of the following statements matches the sequential method of cost allocations? a. Support departments are often allocated in order from lowest to the highest cost with preference given to the departments that serve few support departments and have no accurate cost drivers. b. Support departments are often allocated in order from highest to lowest cost with preference given to the departments that serve many support departments and have accurate cost drivers The sequential method only allocates costs to departments that have a high profit margin.