Phoenix Partners provides management consulting services to government and Corporate clients Phoenix has two support depart ament e services (AS) and information systems (15) and two operating departments-government consting (GOVT) and corporate consulting (CORP) For the first quarter of 2017, Phoenix's cost records indicate the following (Click the icon to ww the cost records The two Sport department costs have been allocated to the two operating departments the vect method and the step-down method (AS department fest) and the step down method (15 department . The results of the location ale as follows: Chok the icon to view the direct method) Read the requirements Click the icon to view the step-down method (AS first) Click the icon to view the step down method (I first) Click the icon to view a summary of the three methods ) Requirement 1a. Allocate the two support departments costs to the two operating departments using the reprocal method Fest determine the linear equations for each support department AS: 5600,000 + 0.10 is $2.400.000 . 025 AS Now allocate the support department costs AS and is reciprocal method (Round decal cacbon the de when decreasing departments by acting costs Ena cons that you demned in the respo hews operating departments using the c es, XOOX, and your a wers to the newest whole dar se parentheses or a minus bor any zero balances) Support Departments Operatin Departments Data Table SUPPORT OPERATING GOVT CORP AS Total $ 600,000 $ 2,400,000 $8,756,000 $ 12,452,000 $ 24,208,000 Budgeted overhead costs before any interdepartment cost allocations Support work supplied by AS (budgeted head count) Support work supplied by IS (budgeted computer time) 25% 40% 35% 100% 10% 30% 60% 100% fiesto de Direct method Support Departments IS Operating Departments GOVT CORP Total Direct Method Budgeted overhead costs before interdepartment cost allocations Allocation of AS costs Allocation of IS costs Total budgeted overhead of operating departments 600,000 $ 2,400,000 $ 8,750,000 $ (600,000) 320,000 (2.400,000) 300,000 0$ 9,876000 $ 12,462 000 $ 24 208,000 280,000 1,600,000 14,332,000 $ 24,208,000 Print Done procal Method GOVT CORP Step-down method (AS first) Support Departments AS IS Operating Departments GOVT CORP Step-down Method Budgcted overhead costs before interdepartment cost allocations 600,000 $ (600,000) 2,400,000 $ 150,000 3,756 000 $ 240,000 12,452,000 $ 24,208,000 210,000 Allocation of AS costs Allocation of IS casts 2 550 000 12,550,000) 0 $ 850,000 9,846,000 $ 1,700,000 14,362,000 $ 24,208,000 Total budgeted overhead of operating departments nom Step down method (IS first) Support Departments Operating Departments GOVT CORP Step-down Method Budgeted overhead costs before interdepartment cost allocations Allocation of Is costs 600,000 $ 240,000 2,400,000 $ 8,756,000 $ (2.400 000) 720.000 12,452,000 $ 24 208,000 1.440,000 840 000 (840,000) Allocation of AS costs 448 000 392 000 Total buigeted overhead of operating departments $ 9,924,000 $ 14,284,000 $ 24, 200 000 Reference GOVT CORP Direct method Step-down (AS first) Step-down (IS first) 1,120,000 $ 1,090,000 1,168,000 1,880,000 1,910,000 1,832,000 Print Done 9 de Use 1. Allocate the two support departments' costs to the two operating departments using the reciprocal method. Use (a) linear equation and (b) repeated iterations Compare and explain differences in requirement 1 with those of the direct method and the step down method. Which method do you prefer? Why? 2. Print Done Now allocate the support departments' costs (AS and IS department costs that you determined in the prior step) to the two operating departments using the reciprocal method. (Round decimal calculations to three decimal places XXX, and your final answers to the nearest whole dollar Use parentheses or a minus sign when decreasing departments by allocating costs Enter a 'O' for any zero balances) Support Departments Operating Departments Reciprocal Method AS IS GOVT CORP Total Budgeted overhead costs before interdepartment cost allocations Allocation of AS costs Allocation of IS casts Total budgeted overhead of operating departments Enter any member in the edit falt and then clichov har