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 Reality Company. Use of services by other departments is as follows. The equation for department P1 (subassemblies)is:
A)P1 = $550,000 + .25P2 + .20P3 + .15S2 + 10S3.
B)P1 = $550,000 + .30S1 + .50S2 + .20S3.
C)P1 = .30S1 + .50S2 + 20S3.
D)P1 = .30S1 + .50S.

Question

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 Reality Company.  Use of services by other departments is as follows.  The equation for department P1 (subassemblies)is:
A)P1 = $550,000 + .25P2 + .20P3 + .15S2 + 10S3. 
B)P1 = $550,000 + .30S1 + .50S2 + .20S3. 
C)P1 = .30S1 + .50S2 + 20S3. 
D)P1 = .30S1 + .50S.

Quizplus · Accepted Answer

The Answer of 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 Reality Company.  Use of services by other departments is as follows.  The equation for department P1 (subassemblies)is:
A)P1 = $550,000 + .25P2 + .20P3 + .15S2 + 10S3. 
B)P1 = $550,000 + .30S1 + .50S2 + .20S3. 
C)P1 = .30S1 + .50S2 + 20S3. 
D)P1 = .30S1 + .50S.

The Following Set Up Is a System of Simultaneous Linear