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Consider the following statements about the direct method of service department cost allocation: Under the direct method, all service department costs are eventually allocated to
Consider the following statements about the direct method of service department cost allocation:
- Under the direct method, all service department costs are eventually allocated to production departments.
- The order in which service department costs are allocated to production departments is important.
- Once a service department's costs have been allocated, no costs are re-circulated back to that department.
Which of the above statements is (are) correct?
Multiple Choice
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I only.
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II only.
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I and II.
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I and III.
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I, II, and III.
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