Final answer:
The direct method does not consider the interaction among support departments, while the step-down method does.
Step-by-step explanation:
The direct method and the step-down method are two approaches to allocate overhead costs in support departments. In the direct method, the interaction among support departments is not considered. Under this method, the costs of the support departments are allocated directly to the production departments.
This means that no allocation is made for the services that support departments provide to each other. On the other hand, the step-down method does consider the interaction among support departments. It allocates costs from one support department to another based on a predetermined sequence or hierarchy, taking into account the services provided by each department to the others.
For example, if support department A provides services to both support department B and support department C, its costs will be allocated to department B and department C before any other allocations occur.