Exercise $7-28($Algo$)$ Departmental Cost Allocation $[$LO $7-3,7-5]$

HomeLife Life Insurance Company has two service departments $($actuarial and premium rating$)$ and two production

departments $($advertising and sales$).$ The distribution of each service department's efforts $($in percentages$)$ to the other

departments is shown in the following table:

The direct operating costs of the departments $($including both variable and fixed costs$)$ are:

Required:

$1.$ Determine the total costs of the advertising and sales departments after using the direct method of allocation.

$2.$ Determine the total costs of the advertising and sales departments after using the step method of allocation.

$3.$ Determine the total costs of the advertising and sales departments after using the reciprocal method of allocation.