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4) Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: Budgeted
4) Hugo, owner of Automated Fabric, Inc., is interested in using the reciprocal allocation method. The following data from operations were collected for analysis: Budgeted manufacturing overhead costs: Maintenance M (Support Dept) Personnel P (Support Dept) Weaving W (Weaving Dept) Colorizing C(Colorizing Dept) $400,000 $150,000 $620,000 $360,000 Services furnished: By Maintenance (budgeted labor-hours): to Personnel to Weaving to Colorizing By Personnel (Number of employees serviced): Plant Maintenance Weaving Colorizing 1000 8000 4100 Which of the following linear equations represents the complete reciprocated cost of the Personnel Department? A) P = $400,000 - $150,000 (1000/13,100) M B) P = $150,000 + (1000 / 13,100) M C) P = (1000 / 13,100) M D) P= $150,000
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