Murphy Company has two service departments Maintenance andPersonnel as well as t

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Murphy Company has two service departments Maintenance andPersonnel as well as two production departments Mixing andFinishing. Maintenance costs are allocated based on square footagewhile personnel costs are allocated based on number of employees.The following information has been gathered for the currentyear: MaintenancePersonnel MixingFinishingDirect dept. costs$126000 $84000$105000 $175000Square footage 800400 1600 1200Number of employees8 1224 32If the step-down method of allocating costs is used and thePersonnel Department is allocated first then the amount ofoverhead that would be allocated from Personnel to Mixing is_____.A. $58500B. $63000C. $78000D. $31500

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