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 incurs $50,000 of costs, under the direct method what is the amount of costs that would be allocated?

Question 2 options:

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

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

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

d)None of the alternatives are correct

e)Personnel $10,000; Video $50,000; and Co