Costs Applicable to Grants, Contracts and Other Agreements with Educational Institutions''

A. Allocation is the process of assigning a cost, or a group of costs, to one or more cost objective, in reasonable and realistic proportion to the benefit provided or other equitable relationship. A cost objective may be a major function, a particular service or project, a sponsored agreement, or a Facilities and Administrative cost activity. The process may entail assigning a cost(s) directly to a final cost objective or through one or more intermediate cost objectives. B. Departmental Administration expenses are those that have been incurred for administrative and supporting services that benefit common or joint departmental activities or objectives in academic deans ' offices, academic departments and divisions, and organized research units. Departmental administration expenses include salaries and fringe benefits attributable to the administrative work (including bid and proposal preparation) of faculty (including department heads), and other professional personnel conducting research and/or instruction, allowed at a rate of 3.6 percent of modified total direct costs. C. Depreciation and Use Allowances are the portion of the costs of campus buildings, capital improvements to land and buildings, and equipment which are computed in accordance wit