Stomp-rite Inc. makes hiking boots. The company operates with two processing departments: the cutting department and the assembly department. The human resources and maintenance departments support the processing departments. Budgeted costs for the support departments for the period are as follows:

Human resources

Maintenance

Salaries and wages

$ 105,000

$ 14,000

Direct costs

15,000

24,000

Depreciation

30,000

32,000

Total

$ 150,000

$ 70,000

Costs are allocated to the processing departments based on the following activity levels:

Supplied by

Human resources

Maintenance

Cutting

Assembly

Human resources (employees)

15

25

175

200

Maintenance (square metres)

2,000

3,000

10,000

40,000

Using the step-down method, beginning with human resources, how much of the total support department costs should be allocated to assembly?

a) $124,425

b) $129,770

c) $135,282

d) $138,500