At the Company, the cost of the personnel department has always been charged to production departments based upon number of employees. Recently, opinions gathered from the department managers indicate that the number of new hires might be a better predictor of personnel costs.

Total personnel department costs are $287,500.

DepartmentABC

Number of employees70280225

Number of new hires251312

8) If the number of employees is considered the cost driver, what amount of personnel costs will be allocated to Department A?