A company has two production departments and one service department. Budgeted annual overheads for cost assignment total $75,000. The following information is available for the three departments:

	Production X	Production Y	Service
Floor area (sq m)	400	850	250
Machine value ($ 000)	300	600
Direct Labour Hours	20,000	10,000

In the first step of apportionment, overheads are assigned to all departments on the basis of floor area. Which of the following statements is correct?

Select one:

A. $40,000 are assigned to Production Department X and $18,750 to the Service Department.

B. $17,000 are assigned to Production Department Y and $12,500 to the Service Department.

C. $42,500 are assigned to Production Department Y and $25,000 to the Service Department.

D. $40,000 are assigned to Production Department X and $25,000 to the Service Department.

E. $20,000 are assigned to Production Department X and $12,500 to the Service Department.