The company has two product lines (clothing and shoes), which are produced in separate manufacturing facilities; however, both manufacturing facilities share the same support services for information technology and human resources. The following shows total costs for each manufacturing facility and for each support department.

The total costs of the support departments (IT and HR) are allocated to the production departments (clothing and shoes) using a single rate based on the following:

Information technology: Number of IT labour hours worked by department

Human resources: Number of employees supported by the department

Data on the bases, by department, are given as follows

Total Costs by Variable Costs Fixed Costs Department (in thousands) Information technology (IT) $500 $1,500 $2,000 Human resources (HR) $100 $900 $1,000 Clothing $3,000 $7,000 $10,000 Shoes $2,500 $5,500 $8,000 Total costs $6,100 $14,900 $21,000 Department IT Hours Used Number of Employees Clothing 5,000 120 Shoes 3,000 40 Information technology 40 Human resources 2,000