Exercise 4-16A (Algo) Allocating costs of service centers to operating departments-direct method LO 4- 6 Vernon Trust Corporation has two service departments: actuary and economic analysis. Vernon also has three operating departments: annuity, fund management, and employee benefit services. The annual costs of operating the service departments are $702,800 for actuary and $878,500 for economic analysis. Vernon uses the direct method to allocate service center costs to operating departments. Other relevant data follow. Operating Costs* Revenue Annuity Fund management Employee benefit services $ 670,000 1,070,000 770,000 $ 894,000 1,360,000 1,260,000 *The operating costs are measured before allocating service center costs. Required a. Use operating costs as the cost driver for allocating service center costs to operating departments. b. Use revenue as the cost driver for allocating service center costs to operating departments. Complete this question by entering your answers in the tabs below. Required A Required B Use operating costs as the cost driver for allocating service center costs to operating departments. (Round "Allocation Rate" to 2 decimal places.) Allocation of actuary cost: Annuity Department Fund management EBS Total allocated cost Allocation Rate x Weight of Base = Allocated Cost x X |= $ = 0 0 0 0 Check JFFIHIIIS 8 FuI IIIL2: Complete this question by entering your answers in the tabs below. Required A Required B Use operating costs as the cost driver for allocating service center costs to operating departments. (Round "Allocation Rate" to 2 decimal places.) Allocation of actuary cost: Allocation Rate x Weight of Base Department Annuity Fund management EBS Total allocated cost Allocated Cost $ 0 x |= 0 X = 0 $ 0 Allocation of economic analysis cost: Allocation Rate x Weight of Base = Allocated Cost Department Annuity Fund management EBS Total allocated cost X X x Required A $ = 0 0 0 $ 0 Required B > Screenshot Check JFFIHIIIS 8 FuI IIIL2: Complete this question by entering your answers in the tabs below. Required A Required B Use revenue as the cost driver for allocating service center costs to operating departments. (Round "Allocation Rate" to 2 decimal places.) Allocation of actuary cost: Allocation Rate x Weight of Base Department Annuity Fund management EBS Total allocated cost Allocated Cost x |= $ 0 x = 0 X = 0 $ 0 Allocation Rate x Weight of Base = Allocated Cost Allocation of economic analysis cost: Department Annuity Fund management EBS Total allocated cost X X x $ |= 0 0 0 0 < Required A Required B Screenshot Check