QUESTION 15

1. Service department costs are allocated to user departments, in part, because:

   	A.	it helps ensure that machines are operating efficiently.
   	B.	user departments use the functions of service departments.
   	C.	service departments are final cost centers.
   	D.	it measures the use of plant capacity.

3 points

QUESTION 16

1. Which of the following is not true of service department cost allocation?

   	A.	The reciprocal method best reflects the process by which services are exchanged among departments within organizations.
   	B.	The first step of the step method ignores services provided by one service department to another.
   	C.	The direct method ignores services provided by one service department to another.
   	D.	No matter what method is used, the total amount of allocations to all user departments is the same.