ABC Company budgets the following amounts for its Service departments:

Stores $50,000

Computer services $85,000

The budget for the Production department is as follows:

Machining $100,000

Assembly $250,000

The Stores and Computer Services departments provide services to the Machining andAssembly departments as well as to each other in the following relationship:

Stores Computer Services Machining Assembly

Stores -------- 20% 60% 20%

Computer Services 15% ---------- 30% 55%

Required:

Allocate the service departments cost to the production and service department using the reciprocal method.