Bartolo Delivery has two divisions, air express and ground service, that share the common costs of the company’s communications network, which are $8,100,000 a year. You have the following information...

Bartolo Delivery has two divisions, air express and ground service, that share the common costs of the company’s communications network, which are $8,100,000 a year. You have the following information about the two divisions and the common communications network:

	Calls (thousands)	Time on Network (hours)
Air express		623,000			337,500
Ground service		267,000			1,012,500

Required:

Determine the cost allocation if $5.67 million of the communications network costs are fixed and allocated on the basis of time on network, and the remaining costs, which are variable, are allocated on the basis of the number of calls.(Enter your answers in whole dollars.  Do not round intermediate calculations.)

Extracted text: Air Express Ground Service Fixed Variable Total


Extracted text: Time on Network Calls (thousands) (hours) 337,500 1,012,500 Air express 623,000 267,000 Ground service