Using the Reciprocal Services Method, Which of the Following Equations

question 161

Multiple Choice

Using the reciprocal services method, which of the following equations represents the algebraic expressions for the two equations needed to capture the total costs of a Janitorial Department (J) that includes not only $500,000 of direct costs but also 25% of the Maintenance Department (M) cost and the Maintenance Department that includes not only $450,000 of direct costs but also 30% of the Janitorial Department?

• A)J = $500,000 + (0.25 ÷ M) and M = $450,000 + (0.30 ÷ J)
• B)J = ($500,000 × 0.25) + M and M = ($450,000 × 0.20) + J
• C)J = $500,000 - (0.25 × M) and M = $450,000 - (0.20 × J)
• D)J = $500,000 + (0.25 × M) and M = $450,000 + (0.20 × J)

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Definitions:

Factory Profits

Refers to the net income generated from manufacturing operations after deducting all operational costs and expenses.

High Demand

A market condition where the desire for a product or service significantly exceeds its supply or availability.

Maximin Criterion

A decision rule used in uncertainty conditions, selecting the option with the best of the worst possible outcomes.

Uncertainty

The state of having limited knowledge about an existing condition or future outcome, making it difficult to make accurate predictions or decisions.