Please explain?

The Service Department determined their budget formula to be $180,000 fixed cost monthly plus $180 per hour of computer time used. Based on long-run predicted usage, the fixed costs were allocated on a lump-sum basis, $25% to business and $75% to engineering. Requirements 1. Show the total allocation if business used 210 hours and engineering used 490 hours in a given month. Assume that the actual costs coincided exactly with the budgeted amount for total usage of 700 hours. 2. Assume the same facts as in number 1 except that the fixed costs were allocated on the basis of actual hours of usage. Show the total allocation of costs to each school. As the dean of the school of business, would you prefer this method or the method in number 1? Explain. Requirement 1. Show the total allocation if business used 210 hours and engineering used 490 hours in a given month. Assume that the actual costs coincided exactly with the budgeted amount for total usage of 700 hours. Business Engineering Fixed costs Variable costs Total costs