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University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the

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University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). 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. The following data appear in the company records for the current period: Maintenance Personnel 1,000 Machine-hours Labor-hours Department direct costs Printing 1,000 500 $ 42,800 Developing 3,000 2,000 $33,000 500 $12,500 $39, 250 University Printers estimates that the variable costs in the Personnel Department total $17,500 and in the Maintenance Department variable costs total $8,100. Avoidable fixed costs in the Personnel Department are $5,600. Required: If University Printers outsources the Personnel Department functions, what is the maximum it can pay an outside vendor without increasing total costs? (Do not round intermediate calculations.) Maximum Amount

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