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.

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Definitions:

Western Blot

A laboratory technique used to detect specific proteins in a sample by using gel electrophoresis followed by transfer to a membrane and marking with antibodies.

HIV Infection

The condition resulting from the human immunodeficiency virus (HIV) attacking the immune system, potentially leading to AIDS.

Blood Calcium

refers to the level of calcium in the blood, essential for bone health, muscle function, and nerve signaling.

mEq/L

Milliequivalents per liter, a unit of measurement in chemistry and medicine indicating the concentration of ions in a solution.