Using the reciprocal services method, which of the following equations represents the correct algebraic expression needed to capture the total costs of a Janitorial Department (J) that includes $350,000 of direct costs and 30% of the Maintenance Department (M) cost and the Maintenance Department that includes $50,000 of direct costs and 50% of the Janitorial Department? (Hint: This equation is derived from the two separate equations representing each department's costs.)
A)J = $350,000 + (0.30 ÷ $50,000) + (0.50 ÷ J)
B)J = ($350,000 × 0.30) + ($50,000 × 0.50) + J
C)J = $350,000 - [(0.30 × $50,000) - (0.50 × J)]
D)J = $350,000 + {0.30 × [$50,000 + (0.50 × J)]}

Question

Quizplus · Accepted Answer

The correct equation, D, represents the total cost of the Janitorial Department (J) by including its direct costs ($350,000) and adding 30% of the total Maintenance Department (M) costs. The Maintenance Department's costs are represented as its direct costs ($50,000) plus 50% of the Janitorial Department's costs (0.50 × J), which is then multiplied by 0.30 to account for the 30% of M's costs allocated to J.

Using the Reciprocal Services Method, Which of the Following Equations