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The Following Set Up Is a System of Simultaneous Linear

question 14

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The following set up is a system of simultaneous linear equations to allocate costs using the reciprocal method.Matrix algebra is not required.The following costs were incurred in three operating departments and three service departments in Westmoreland Company.  Department  Drect Costs  Label  Subassemblies $550,000P1 Final assembly 776,000P2 Marketing 285,000P3 Building occupancy 85,000S1 Research&development 120,000 S2 Supervision 45,000S3\begin{array} { | l | r | r | } \hline \text { Department } & \text { Drect Costs } & \text { Label } \\\hline \text { Subassemblies } & \$ 550,000 & \mathrm { P } 1 \\\hline \text { Final assembly } & 776,000 & \mathrm { P } 2 \\\hline \text { Marketing } & 285,000 & \mathrm { P } 3 \\\hline \text { Building occupancy } & 85,000 & S1 \\\hline \text { Research\&development } & 120,000 & \mathrm {~S} 2 \\\hline \text { Supervision } & 45,000 & \mathrm { S3 } \\\hline\end{array} Use of services by other departments is as follows.  The following set up is a system of simultaneous linear equations to allocate costs using the reciprocal method.Matrix algebra is not required.The following costs were incurred in three operating departments and three service departments in Westmoreland Company. \begin{array} { | l | r | r | }  \hline \text { Department } & \text { Drect Costs } & \text { Label } \\ \hline \text { Subassemblies } & \$ 550,000 & \mathrm { P } 1 \\ \hline \text { Final assembly } & 776,000 & \mathrm { P } 2 \\ \hline \text { Marketing } & 285,000 & \mathrm { P } 3 \\ \hline \text { Building occupancy } & 85,000 & S1 \\ \hline \text { Research\&development } & 120,000 & \mathrm {~S} 2 \\ \hline \text { Supervision } & 45,000 & \mathrm { S3 } \\ \hline \end{array}  Use of services by other departments is as follows.  The equation for department S1 (building occupancy) is:  A)  S1 = .10S3. B)  S1 = $85,000 + 1.00S3. C)  S1 = $85,000 + .10S3. D)  S1 = $85,000 + .90S2 + .10S3. The equation for department S1 (building occupancy) is:


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