Motorcade Company has three service departments (S1, S2, and S3) and two production departments (P1 and
P2). The following data relate to Motorcade’s allocation of service department costs:
Costs Nbr of
Employees S1 $3,280,000 75 S2 2,700,000 50 S3 1,000,000 25 P1 150 P2 225 Service department costs are allocated by the direct method. The number of employees is used as the allocation
base for all service department costs
Calculate the total service department cost allocated to production department P1