Madison Company has two service departments (personnel and accounting) and two operating departments (computer and video). The computer department uses 40% of the accounting department services, the video department uses 50% and the personnel department uses 10%. If the accounting department is allocated first and incurs $50,000 of costs, under the step-down method the allocation would be:

Question 6 options:

a)Video $27,778; and Computer $22,222

b)None of the alternatives are correct

c)Video $25,000; and Computer $25,000

d)Personnel $10,000; Video $50,000; and Computer $40,000

e)Personnel $5,000; Video $25,000; and Computer $20,000