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Which of the following statements explains the major difference between the sequential method and the direct...

Which of the following statements explains the major difference between the sequential method and the direct method?

  1. Under the direct method, the total support department costs to be allocated will also include any costs that were allocated to that support department from other support departments.

  1. Under the sequential method, the total support department costs to be allocated will never include any costs that were allocated to that support department from other support departments.

  1. Under the sequential method, every support department receives costs allocated from every other support department.

  1. Under the sequential method, the total support department costs to be allocated will also include any costs that were allocated to that support department from other support departments.

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Answer #1

Answer:

  1. Under the sequential method, the total support department costs to be allocated will also include any costs that were allocated to that support department from other support departments.

As

it is rightly said as under sequential method first of all the overheads are allocated from the support department which provide services to all other department and then the overhead of second support department after including the allocated cost from first support department is allocated to remaining support department and this process continues like this

whereas under direct method no support department includes allocated cost from other support department

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