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1. How could the direct method be useful in making decisions?

2. After researching the reciprocal method, I am in complete agreement the reciprocal method being the most efficient cost allocation method. According to an accounting resource, the reciprocal method is a method of allocating service department costs to other organizational departments, which results in providing full recognition to interdepartmental services. Lastly, I also learned the reciprocal method allocates service department costs in both directions. Can someone add to this?

http://www.accountingformanagement.com/reciprocal_method.htm

Business Management, Management Studies

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