Activity- Essed Costing for a Service Company Five-Stars Insurance Company camies three major lines of insurancei auto, workers' compensation, and homeawnert. The company has prepared the following ropart. Hve-Stars Insurance Company Management is concerned that the administrative expenses may make some of the insurance lines unprohitabief However, the adminiatrabive ineperises have nat been aliocated to the insurance lines. The controller has suggented that the administrative oxpenses could be assignee to the ingurance lines uting activity-based easting The Bdministratrve expenses are comprised of five activities. The activities and their rates are as follows: a. Complete the produgt prefitebility report threvghi the administrative activities. Determine the operating incame at a perennt ar puemium reverue: founded to the nesrest whole percent. 3. Caiculate hctivity Cost far each product Activity-Gate Usimex Aatiqity A Aate = Activity Costz Suntract eachativify cost from underwriting income for each product to obtain incame froms operatians. Divide theome frin operatigns by gremium revenue to obtain a percentage. b. Interpont the repart