Question

The housekeeping and facilities departments of Hospital XYZ first did a one-time allocation of their costs, after which they allocated their costs to the Ob-Gyn Department that performed Melissa's hysterectomy (removal of the uterus). What method of allocating costs was involved in this case?

Multiple apportionment

Double apportionment

Step-down apportionment

Direct apportionment

none of the choices listed here

Answer 1

Answer:

Option d: Direct Apportionment

Explanation:

Direct Apportionment is the method of allocating overheads in which the of service departments are allocated single time on operating departments.

Step down apportionment is the method in which cost of a service department is allocated to all other departments and the cost of other service departments is allocated only to other operating departments.

So, as housekeeping and facilities departments allocated their costs one time only, it is a case of direct apportionment.

In case of any doubt, please comment.