Consider the Following Statements About the Step-Down Method of Service

Multiple Choice

Consider the following statements about the step-down method of service department cost allocation:
I. Under the step-down method, all service department costs are eventually allocated to production departments.
II. The order in which service department costs are allocated is important.
III. After a service department's costs have been allocated to other departments, no costs are re-circulated back to that service department.
Which of the above statements is (are) correct?

A) I only.
B) II only.
C) I and II.
D) I and III.
E) I, II, and III.