Use the Following Information for the Next 4 Questions

Multiple Choice

Use the following information for the next 4 questions. The managers of Conch, Inc. want to determine the most accurate allocation of support department costs to operating departments. To make this allocation, the accounting department has collected the following data:
-If the reciprocal method is used, the equation representing the total cost of the computer department is

A) Computer costs = $55,000 + (0.15 × cafeteria cost)
B) Computer costs = $55,000 + (0.10 × cafeteria cost)
C) Computer costs = $55,000
D) Computer costs = $55,000 + 0.10 × ($55,000 + 0.10 × computer cost)