Arbon Company has three service departments and two operating departments. Selected data concerning the five departments are presented below:

	Service Departments									Operating Departments
	Administrative			Janitorial			Equipment Maintenance			Prep			Finishing			Total
Costs	$	86,000		$	67,800		$	36,000		$	256,100		$	498,600		$	944,500
Number of employees		80			60			240			600			300			1,280
Square metres of space occupied		300			1,200			1,000			2,000			7,000			11,500
Machine-hours											14,000			56,000			70,000

The company allocates service department costs by the step-down method in the following order: Administrative (number of employees), Janitorial (space occupied), and Equipment Maintenance (machine-hours).

Required: 1) Using the step-down method, allocate the service department costs to the operating departments.

2) Using direct method, allocate the service department costs to the operating departments.