Princess Cruise Lines has the following service departments; concierge, valet, and maintenance. Expense for these departments are allocated to Mediterranean and Trans-Atlantic cruises. Expenses for the departments are totaled (both variable and fixed components are combined) and as follows:
Concierge $2,500,000
Valet $1,750,000
Maintenance $4,250,000
The sea miles logged are 6,000,000 for the Mediterranean and 18,000,000 for the Trans-
Atlantic voyages.
Based upon the sea miles logged, allocate the service department costs.