Steamco is revlewing its operations to see what additional energy-saving projects it might adopt. The company's manufacturing plant generates its own electricity using a process capturing steam from its production processes. A summary of the use of service departments by other service departments as well as by the two producing departments at the plant follows. Direct costs (in thousands) in the various departments follow: Steamco currently allocates costs of service depatments to production departments using the step method. The local power company Indicates that it would charge $480.000 per year for the electricity that Steamco now generates internally. Management rejected switching to the power company on the grounds that its rates would cost more than the $330,000($90,000+$240.000) cost of the Indicates that it would chates costs of service departments to production departments using the step method, The local power company switching to the power company on the per year for the electricity that Steamco now generates internally. Management rejected present, company-owned, system. Required: a. What costs of electric service did management use to prepare the basis for its decision to continue generating power internally? b-1. Prepare for management an analysis of the costs of the company's own electric generating operations. (Use the step method.) The rank ordet of allocation is (1) S1, (2) S4, (3) S2, and (4) S3. b-2. Should management continue to generate power intemally? c-1. Assume the compary could realze $174,000 per year from the sale of the stearn now used for electric generating after selling costs. Compute the total relevant internal costs for-the company. c-2. Should management continue to generate power internally