how do we reapportion HR cost?

A business consists of four cost centres: m Preparation department m Machining department m Finishing department m Human resources (HR) department. The first three are product cost centres and the last renders a service to the other three. The level of service rendered is thought to be roughly in proportion to the number of employees in each product cost centre. Overheads, and other data, for next month are expected to be as follows: 000 Rent 10,000 Electricity to power machines 3,000 Electricity for heating and lighting 800 Insurance of building 200 Cleaning 600 Depreciation of machines 2,000 Total monthly salaries of the indirect workers: Preparation department 200 Machining department 240 Finishing department 180 HR department 180 The HR department has a staff consisting of only indirect workers (including managers). The other departments have both indirect workers (including managers) and direct work- ers. There are 100 indirect workers within each of the four departments and none does any 'direct' work. Each direct worker is expected to work 160 hours next month. The number of direct workers in each department is: Preparation department 600 Machining department 900 Finishing department 500