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Need help 2 profit centers: Oncology and Orthopedics 2 service departments: HR and IT # of hrs: Service Dept. Profit Dept. HR IT Oncology 2900

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2 profit centers: Oncology and Orthopedics

2 service departments: HR and IT

# of hrs:

Service Dept.

Profit Dept. HR IT

Oncology 2900 3620

Orthopedics 2770 3810

Service Dept.

Accg. 2650 2850

IT 2820 2750

Ttl. 11,140 13,030

Ttl op cost: HR 42 mil & IT 50 mil

? Allocate service dept costs to profit centers using, step down using HR 1st, then using IT 1st, finally direct method ?

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