Solution:
Department A = $80,000 + 0.30 Department B
Department B = $60,000 + 0.10 Department A
Department B = $60,000 + 0.10 ($80,000 + 0.30 Department B)
= $68,000 / 0.97 = $70,103
Department A cost = $80,000 + 0.3*$70,103 = $101,031
Department A cost allocated to department C = $101,031 * 60% = $60,619
Hence 2nd option is correct.
The following information relates to Osceola Corporation for the past accounting period. Service Department A Service...