Mertens Company provides the following ABC costing information: Activity-cost driver 10,000 hours 4,000,000 lines 40,000 accounts 4,000 letters t inquiry hours S200,000 S140,000 $75,000 S 25,000 S440,000 Account billing lines Account verification accounts Total costs The above activities are used by Departments A and B as follows: Department B 4,000 hours 200,000 lines 8,000 accounts 1,600 letters inquiry hours 2,000 hours 400,000 lines 10,000 accounts 1,000 letters Account Account billing lines Account verification accounts Correspondence letters a. Calculate the cost allocation rates. Activity Allocation Rate nquiry t billing t verification b. Allocate the activity costs to the departments. Allocated costs Activity Department A Department B nquiry t billing t verification Total c