Computer Information Sevices is a computer software consulting company. Its three major functional areas are computer programming, information systems consulting, and software training. Carol Birch, a pricing analyst in the Accounting Department, has been asked to develop total costs for the functional areas. These costs will be used as a guide in pricing a new contract. In computing these costs. Birch is considering three different methods of allocating overhead costs-the direct method, the step method, and the reciprocal method. Birch assembled the following data on overhead from its two service departments, the Information Systems Department and the Facilities Department.

	Service Departments		User Deparments
	Systems	Facilities	Computer Program	Consult	Training	Total
Budgeted Overhead	$50,000	$25,000	$75,000	$110,000	$85,000	$345,000
Info System (hrs)		400	1,100	600	900	3,000
Facilities (Sq ft)	200,000		400,000	600,000	800,000	2,000,000

1) Allocate the service department costs to the user departments using the direct method.

2) Allocate the service department costs to the user departments using the step method. Allocate Information Systems first and round to the nearest dollar. Provide total user department costs.

3) Allocate the service department costs to the user departments using the reciprocal method.