Advanced Computer Solutions, Inc In a Typical Period, the Operation Department (Op) Spends $4,500

Multiple Choice

Advanced Computer Solutions, Inc. has two main services: (1) time on a timeshared computer system, and (2) proprietary computer programs. The operation department (Op) provides computer time and the programming department (P) writes programs.
The percentage of each service used by each department for a typical period is:
$\begin{array}{c}\quad\quad\quad\quad\quad\quad\text { Supplied }\\\begin{array}{lll}\text { User } & \text { Op } & P \\\text { Op } & --- & 40 \% \\\text { P } & 30 \% & --- \\\text { Sold to customers } & 70 \% & 60 \%\end{array}\end{array}$
In a typical period, the operation department (Op) spends $4,500 and the programming department (P) spends $2,500.
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Under the reciprocal method what is the algebraic solution to the cost allocation problem?

A) Op = $4,500 + 0.40P; P = $2,500 + 0.30Op.
B) Op = $4,500 + 0.70P; P = $2,500 + 0.60Op.
C) Op = $2,500 + 0.40P; P = $4,500 + 0.30Op.
D) Op = $2,500 + 0.70P; P = $4,500 + 0.60Op.