Hello,

I need help with solving the following problem:

Data Performance, a computer software consulting company, has three major functional areas: computer programming, information systems consulting, and software training. Carol Bingham, a pricing analyst, 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, Carol is considering three different methods of the departmental allocation approach to allocate overhead costs: the direct method, the step method, and the reciprocal method. She assembled the following data from the two service departments, information systems and facilities:

The problem asks to:

1. Using computer usage time as the allocation base for the information systems department and square feet of floor space as the application base for the facilities department, apply overhead from these service departments to the production departments, using these three methods:

a. Direct method.

b. Step method (both for the information systems department going first and for the facilities department going first).

c. Reciprocal method.

The problem provides the following chart for the solution (i tried to make connections but couldn't get the right answers.

Please help.

Service Departments Production Departments Information Systems Information $88,000 200 Computer Software Systems Facilities Programming Consulting Training Budgeted overhead (base) Information Systems Facilities (square feet) Total $44,000 1,600 $158,000 800 600 $197,000 $137,000 $624,000 8,000 2,000 (computer hours) 1,600 600 4,000 600 (Round percentage calculations to 4 decimal places (e.g., 33.3333%). For all requirements, Do not round your intermediate calculations. Round your final answers to nearest whole dollar amount.) Programming Consulting Training Total 175,000 S 555,000 350,000S 1,002,000 250,000 S 256,000 S 1,272,000 a. Direct Method 195,000$ 200,000$ 200,000S 456,000S 185,000$ 452,000S 200,000$ 560,000$ Step Method (Information Systems Goes First) Step Method (Facilities Goes First) 650,000 C. Reciprocal method