There are three different types of cost allocation methods: the direct method, the step down method, and the reciprocal method. Give a brief explanation of the three cost allocation methods and determine which method is best for the hospital if you are in charge of the finance department. Why would this be the best method? Give an example of how it benefits the hospital.

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Heres a breakdown of the three cost allocation methods and why ActivityBased Costing ABC a type of stepdown method is likely the best fit for a hospit... View the full answer