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Question 1 (20 Marks) Activeware Limited manufactures athletic shoes and athletic clothing for both amateur and professional athletes. The company has two product lines (clothing and shoes), which are produced in separate manufacturing facilities; however, both manufacturing facilities share the same support services for information technology and human resources. The following shows total costs for each manufacturing facility and for each support department. Total Costs by Department Variable Costs (in thousands) Information technology (IT) $500 Human resources(HR) $100 lothing $3,000 . hoes $2,500 otal costs $6,100 $14,900 $21,000 The total costs of the support departments (IT and HR) are allocated to the production departments (clothing and shoes) using a single rate based on the following: Information technology: Number of IT labour hours worked by department Human resources: Number of employees supported by department Data on the bases, by department, are given as follows: Department m Number of Employees 120 Required: 1. Report the total costs of the production departments (clothing and shoes) after the support department costs of information technology and human resources have been allocated using each of the following methods: a. the direct method b. the step-down method c. the reciprocal method 2. Assume that all of the work of the IT department could be outsourced to an independent company for $97.50 per hour. If Activeware Limited no longer operated its own IT department, 30% of the xed costs of the IT department could be eliminated. Should Activeware Limited outsource its IT services