The most widely used methods of support department cost allocations are the:

A) direct method and cost application.
B) cost distribution and step-down method.
C) direct method and step-down method.
D) step-down method and cost application.

Support Department Cost Allocations

The process of distributing indirect costs from service departments to the departments that directly contribute to revenue generation.

Direct Method

A technique in cost accounting where only direct costs are assigned to cost objects, ignoring indirect costs.

Step-Down Method

A cost allocation method used in accounting to assign overhead costs to products or service departments in a sequential manner.