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Question 1 Office Space Ltd sells office furniture. The company has two production departments: Assembly and Finishing. There are three support departments: Material Handling, Equipment Maintenance, and Quality Control. The budgeted overhead costs for 2021 for each department are as follows. Material Handling 850,000 Equipment Maintenance 225,000 Quality Control 125,000 Assembly 634,000 Finishing 342,000 The usage of the support departments' output for the year is as follows: Material Equipment Quality handling Maintenance Control User of the Service: Material Handling 8% 10% Support Departments 12% Equipment Maintenance Quality Control Assembly 5% 35% 45% 20% Production Departments Finishing 55% 52% 58% Required: a) Use the step down method to allocate the budgeted costs of the support departments (Material Handling, Equipment Maintenance, and Quality Control) to the Assembly and Finishing Department. (5 marks) AND b) Use the reciprocal method to allocate the budgeted costs of the support departments (Material Handling Equipment Maintenance, and Quality Control) to the Assembly and Finishing Departments, (15 marks) AND Question 1 continued overleaf PTO Question 1 continued c) The general manager of Office Space has asked you to prepare a report discussing which method is likely to be most helpful to the company. He has also requested that you make a recommendation in that report with regards to whether the company should use a predetermined overhead rate instead of an actual overhead rate. Explain your answer. (10 marks)