David Jones, the new administrator for a surgical clinic, was trying to determine how to allocate his indirect expenses. His staff was complaining that the current method of taking a percentage of revenues was unfair. He decided to try to allocate utilities based on square footage of each department, administration based on direct costs, and laboratory based on tests. David Jones, the new administrator for a surgical clinic, was trying to determine how to

allocate his indirect expenses. His staff was complaining that the current method of taking a

percentage of revenues was unfair. He decided to try to allocate utilities based on square

footage of each department, administration based on direct costs, and laboratory based on

tests.

What are the Day Op Suite's total expenses?

Square Footage Direct Expenses Lab Tests

Utilities $$200,000$

Administration $2,000$ $$500,000$

Laboratory $2,000$ $$625,000$

Day$-$op Suite $3,000$ $$1,400,0004,000$

Cystoscopy $1,500$ $$300,000500$

Endoscopy $1,500$ $$600,000500$

Total $10,000$ $$3,375,0005,000$

What are the Day Op Suite's total expenses?