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Question two: 80% ABC Corp has two service departments, Maintenance and Personnel. Maintenance Department costs...

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Question two: 80% ABC Corp has two service departments, Maintenance and Personnel. Maintenance Department costs of $300,000 are allocated on the basis of budgeted maintenance-hours. Personnel Department costs of $170,000 are allocated based on the number of employees. The costs of operating departments A and B are $188,000 and $282,000, respectively. Data on budgeted maintenance-hours and number of employees are as follows: Production Support Departments Departments A B B Maintenance Department Personnel Department Budgeted costs $300,000 $170,000 $188,000 $282,000 NA 25% 25% 50% Budgeted maintenance-hours Number of employees 20% NA 40% 40% Required: Use the step down method to allocate the Support department to production department (start with Maintenance department) Question One: 20% Explain the difference between step down and reciprocal method

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