Data Master Is a Computer Software Consulting Company

question 135

Essay

Data Master is a computer software consulting company. Its three major functional areas are computer programming, information systems consulting, and software training. Cynthia Moore, 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, Moore is considering three different methods of allocating overhead costs: the direct method, the step method, and the reciprocal method. Moore assembled the following data on overhead from its two service departments, the Information Systems Department and the Facilities Department.
Service Departments User Departments

Information systems are allocated on the basis of hours of computer usage; facilities are allocated on the basis of floor space.
Required:
Allocate the service department costs to the user departments using the reciprocal method. Round to the nearest whole dollar.

---

Definitions:

West German Chancellor

The head of government for West Germany, a position held from the establishment of the Federal Republic of Germany in 1949 until the reunification in 1990.

Nationalist Rebels

Groups or individuals who engage in resistance or armed conflict against established authority or occupation forces, driven by a desire for self-determination or nationalist ideology.

African Colonies

Territories in Africa that were under the rule of foreign powers during the era of imperialism, leading to significant cultural, political, and social changes.

Political Transformation

Political transformation refers to significant changes in the nature, structure, or key policies of a government or political system, often involving reform or revolution.