Midland Resources has two production departments (Fabrication and Assembly) and three service departments (Engineering, Administration, and Maintenance). During July, the following costs and service department usage ratios were recorded:

Required
Allocate the service department costs to the two operating departments using the reciprocal method.

Transcribed Image Text:

Using Department Supplying Department Engineering. Aairniniiaii Engineering Administration Maintenance Fabrication Assembly 40% 20% 50% $90,000 10% 50% 10% 20% $45,000 $315,000 ....$36,000