A consulting firm has two departments, Corporate and Government. Computer support is commonto both departments. The cost of computer support is $9 million. The following information is given: Corporate GovernmentGigabytes of Storage 70,000 30,000Number of Consultants 170 225Required:

A) What is the cost charged to each department if the allocation is based on the number of gigabytes of storage? (Do not round intermediate calculations. Give your answers in thousands of dollars.)

B) What is the cost charged to each department if the number of consultants is the allocation basis? (Do not round intermediate calculations. Give your answers in thousands of dollars.)

C) Most of the business in the Corporate Department is priced on a fixed fee basis, and most of the work in the Government Department is priced on a cost-plus fixed fee basis. Should this affect the choice of the allocation base?