Palermo Industries has two service departments, Accounting and Cafeteria and three production departments Mixing, Finishing and Packaging. The following table shows the costs incurred at the two service departments, as well as the proportion of services provided by the two service departments to the other departments.

Costs Incurred	Service Department	Percent Allocable to
		Acctg	Cafe	Mixing	Finish	Pack
$60,000	Accounting		45%	10%	20%	25%
100,000	Cafeteria	20%		30%	15%	35%

Required:

Allocate the service department costs to the production departments using the reciprocal method.

Show calculations.

	Amount allocable to:
Dept
Costs incurred
Total