Reciprocal Distribution Method of Cost Allocation

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

What makes the reciprocal distribution method of cost allocation so useful?

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1. What mathematical tool is required to perform the reciprocal distribution method?

2. Why isn't the reciprocal distribution method of cost allocation more popular?

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About This Quiz & Worksheet

The math heavy, reciprocal distribution method is an important part of cost allocation. It is even able to help alleviate some of the restrictions found in other costing methods. Our quiz and the corresponding worksheet will help you test your level of understanding in this area.

Quiz & Worksheet Goals

This assessment will test you on information, including:

  • The uses of the reciprocal distribution method of cost allocation
  • The tools used for this method
  • What can be figured using the method
  • Why this costing method has become less popular among accountants

Skills Practiced

  • Making Connections - use your understanding of reciprocal distribution method to determine why it is seldom used
  • Information Recall - access the knowledge you've gained regarding the calculations used in the method
  • Knowledge Application - use your knowledge to answer questions about this method's purpose in the accounting world

Additional Learning

To learn more about the reciprocal distribution method, review the lesson called Reciprocal Distribution Method of Cost Allocation. This lesson covers topics, such as:

  • The process for allocating costs with the reciprocal method for allocating costs
  • How costs are arrived, the correct ledger accounts and correct entries for transferring costs
  • The uses of this method
  • The pros and cons of this method
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