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Great Eastern Credit Union (GECU) has two operating departments (Branches and Electronic) and three service departments (Processing, Administration, and Maintenance). During July, the following costs and service department usage ratios were recorded:

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 Great Eastern Credit Union (GECU) has two operating departments (Branches and Electronic) and three service departments (Processing, Administration, and Maintenance). During July, the following costs and service department usage ratios were recorded:






Required:

Allocate the service department costs to the two operating departments using the reciprocal method.






Explanation

The key to this problem is to recognize that Administration provides no service to either of the other two service departments and that Processing only provides services to Administration and not to Maintenance. Therefore, there are no reciprocal services between Administration and the other service departments or between Processing and Administration.













Thanks


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