Chapter 18: Allocation of Support Activity Costs and Joint Costs
MULTIPLE CHOICE QUESTIONS
Which of the following would be considered a service department for an airline?
All of the above.
Which of the following would not
be considered a service department in a hospital?
Consider the following statements about service department costs:
The costs of the Human Resources Department in a manufacturing organization must
allocated to production departments in order to achieve a correct costing of inventory.
II.The allocation of service department costs requires that an organization select both an
allocation base and an allocation method.
III.Service department cost allocations are more relevant for firms involved in service
industries (e.g., repair, health care) than for those involved with manufacturing.
Which of the above statements is (are) correct?
Type: RC, N
Which of the following methods ignores the fact that some service departments provide
service to other service departments?
Hilton, Managerial Accounting, Sixth Edition