BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees, and Accounting costs are allocated on the basis of number of transactions. A summary of BluStar operations follows.

	Administration			Accounting			Domestic			International
Employees					24			44			32
Transactions		32,000						24,000			96,000
Department direct costs	$	354,000		$	148,000		$	940,000		$	3,710,000

Required:

a. Allocate the cost of the service departments to the operating departments using the direct method.

	To
From	Administration	Accounting	Domestic	International
Department costs
Administration allocation
Accounting allocation
Total cost	$0	$0	$0	$0

b. Allocate the cost of the service departments to the operating departments using the step method. Start with Administration.

	To
From	Administration	Accounting	Domestic	International
Department costs
Administration allocation
Accounting allocation
Total cost	$0	$0	$0	$0

c. Allocate the cost of the service departments to the operating departments using the reciprocal method.

	To
From	Administration	Accounting	Domestic	International
Department costs
Administration allocation
Accounting allocation
Total cost	$0	$0	$0	$0