Ch 07 - Homework i Saved Help Save & Exit Submit Check my work 1 Comprehensive Insurance Company has two product lines: health insurance and auto insurance. The two product lines are served by three operating departments, which are necessary for providing the two types of products: claims processing, administration, and sales. These three operating departments are supported by two departments: information technology and operations. The support provided by information technology and operations to the other departments is shown below. 8 points Support Departments Information Technology Operations 20% 10% Operating Departments Claims Processing Administration 20% 10 50 40% Sales 20% 30 Information technology Operations eBook Ask The total costs incurred in the five departments are: Print References Information technology Operations Claims processing Administration Sales Total costs $ 615,000 1,710,000 270,000 588,000 600,000 $ 3,783,000 Required: Determine the total costs in each of the three operating departments, after departmental allocations, using (a) the direct method, (b) the step method (first for information technology going first in the allocation and then for operations going first), and (c) the reciprocal method. (Do not round intermediate calculations. Round final answers to the nearest dollar.) Operating Departments Claims Processing Administration Sales Total a. Direct Method b. Step Method (Info Tech First) Step Method (Operations First) C. Reciprocal Method Mc Graw Hill Ch 07 - Homework i Saved Help Save & Exit Submit Check my work 1 Comprehensive Insurance Company has two product lines: health insurance and auto insurance. The two product lines are served by three operating departments, which are necessary for providing the two types of products: claims processing, administration, and sales. These three operating departments are supported by two departments: information technology and operations. The support provided by information technology and operations to the other departments is shown below. 8 points Support Departments Information Technology Operations 20% 10% Operating Departments Claims Processing Administration 20% 10 50 40% Sales 20% 30 Information technology Operations eBook Ask The total costs incurred in the five departments are: Print References Information technology Operations Claims processing Administration Sales Total costs $ 615,000 1,710,000 270,000 588,000 600,000 $ 3,783,000 Required: Determine the total costs in each of the three operating departments, after departmental allocations, using (a) the direct method, (b) the step method (first for information technology going first in the allocation and then for operations going first), and (c) the reciprocal method. (Do not round intermediate calculations. Round final answers to the nearest dollar.) Operating Departments Claims Processing Administration Sales Total a. Direct Method b. Step Method (Info Tech First) Step Method (Operations First) C. Reciprocal Method Mc Graw Hill
