The Following Information About Monfort Manufacturing Is Available

question 43

Multiple Choice

The following information about Monfort Manufacturing is available:
Using the reciprocal method,the equations required to calculate the costs of the support departments are: (where T= the cost of Training Department;M=the cost of Maintenance Department)

• A) T=$300,000 + 0.25*M;M=$200,000+0.30*T
• B) T=$300,000 + 0.30*M;M=$200,000+0.25*T
• C) T=$200,000 + 0.30*M;M=$300,000+0.25*T
• D) T=$200,000 + 0.25*M;M=$300,000+0.30*T

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Definitions:

Cash

A physical form of money, such as coins and banknotes, which is used in transactions to purchase goods and services.

Spend

To use money to pay for goods or services, or more broadly, to use resources or time for a particular purpose.

Reciprocity Norm

A social norm dictating that people should repay, in kind, what another person has provided or done for them, fostering mutual cooperation and social bonds.

Free Gift

An item or service given without charge to a customer as an incentive or as part of a promotional strategy.