Use the Information Below to Answer the Following Question(s)

Multiple Choice

Use the information below to answer the following question(s) .The owner of Hi-Tech Fiberglass Fabricators Inc.is interested in using the reciprocal allocation method.The following data from operations were collected for analysis.Budgeted manufacturing overhead costs:
Service furnished:
By Plant Maintenance (budgeted labour hours)
By Data Processing (budgeted computer time)

-Which of the following is a valid conclusion, in comparing the three allocation methods?

A) The reciprocal method is conceptually inferior.
B) The direct method is viewed as too complex by most organizations.
C) The step-down method is viewed as too complex by most organizations.
D) Many managers find the step-down method too simple.
E) Many managers find the reciprocal method difficult to understand.