University Printers has two service departments (maintenance and personnel) and two operating departments (printing and development). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each.

Maintenance Personnel Printing Developing

Machine hours....................... --- 1,000 1,000 3,000

Labor-hours........................... 500 --- 500 2,000

department direct costs......... 5,000 12,000 15,000 10,000

Use the direct method to allocate these service department costs to the operating departments.