Answer the Following Questions Using the Information Below

Multiple Choice

Answer the following questions using the information below:
Murray River Cruises Company has two service departments,Maintenance and Personnel.Maintenance Department costs of $160 000 are allocated on the basis of budgeted maintenance-hours.Personnel Department costs of $40 000 are allocated based on the number of employees.The costs of operating departments A and B are $80 000 and $120 000,respectively.Data on budgeted maintenance-hours and number of employees are as follows:

-Using the direct method,what amount of Maintenance Department costs will be allocated to Department A?

A) $78 000
B) $48 000
C) $64 000
D) $96 000