Repeated distribution method in cost accounting 

The repeated distribution method is a cost allocation technique used in cost accounting to distribute overhead costs to products or services based on multiple cost drivers. This method is also known as the step-down allocation method.

The repeated distribution method involves allocating overhead costs to the first cost pool based on the primary cost driver. Then, the allocated overhead costs are distributed to the second cost pool based on the secondary cost driver. This process is repeated for each subsequent cost pool until all overhead costs have been allocated to the appropriate cost pools.

For example, if the primary cost pool is manufacturing overhead costs and the primary cost driver is machine hours, then the manufacturing overhead costs will be allocated to each department or product based on the machine hours used.

It's worth noting that the repeated distribution method can be used in conjunction with other cost allocation methods, such as activity-based costing (ABC). ABC is a more detailed method of cost allocation that takes into account a wider range of cost drivers and activities. The repeated distribution method can be used to allocate overhead costs to the primary and secondary cost pools in an ABC system, while the more detailed allocation is performed within each cost pool.

The advantage of using the repeated distribution method is that it provides a more accurate allocation of overhead costs than other cost allocation methods, such as the direct method or the single-rate method. This is because it takes into account multiple cost drivers that influence the overhead costs, rather than just one.

However, the repeated distribution method can be more complex and time-consuming to implement than other methods. It also requires accurate data on the cost drivers and their respective usage rates to ensure the accuracy of the cost allocation.

Overall, the repeated distribution method can be an effective way to allocate overhead costs in cost accounting, particularly when multiple cost drivers are involved. However, it can be more complex and time-consuming than other methods, and accuracy relies on having accurate data on cost drivers and usage rates.