Mesa Telcom has three divisions, commercial, retail, and consumer, that share the common cost of the company’s computer server network. The annual…

Mesa Telcom has three divisions, commercial, retail, and consumer, that share the common cost

of the company’s computer server network. The annual common costs are $3,220,000. You have been provided with the following information for the upcoming year:

Connections             Time on Network (hours)

Commercial            58,000                   164,000

Retail                 64,000                   237,000

Consumer             110,000                  399,000

The cost accountant determined $2,300,000 of the server network’s costs were fixed and should be

allocated based on the number of connections. The remaining costs should be allocated based on the time on the network.  What is the total server network costs allocated to the Commercial Division, assuming the company uses dual-rates to allocate common costs?