Advanced Computer Solutions,Inc In a Typical Period,the Operation Department (Op)spends $4,500 and the Computer

question 97

Multiple Choice

Advanced Computer Solutions,Inc.has two main services: (1) time on a timeshared computer system,and (2) proprietary computer programs.Computer time is provided by the operation department (Op) and programs are written by the programming department (P) .The percentage of each service used by each department for a typical period is:
$$\begin{array} { | l | c c | } \hline & { \text { Supplied } } \\\hline \text { User } & \text { Op } & \text { P } \\\hline \text { Op } & - & 40 \% \\\hline \text { P } & 30 \% & - \\\hline \text { Sold to customers } & 70 \% & 60 \% \\\hline\end{array}$$ In a typical period,the operation department (Op) spends $4,500 and the programming department (P) spends $2,500.Under the reciprocal method what is the algebraic solution to the cost allocation problem?

• A) Op = 4,500 + .40 P;P = 2,500 + .30 Op.
• B) Op = 4,500 + .70 P;P = 2,500 + .60 Op.
• C) Op = 2,500 + .40 P;P = 4,500 + .30 Op.
• D) Op = 2,500 + .70 P;P = 4,500 + .60 Op.

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