Willis Corporation, a book publisher, has two service departments: editing and typesetting. Willis also has three operating departments: children's fiction, youth fiction, and adult fiction. The annual costs of operating the editing department are $480,000 and the annual costs of operating the typesetting department are $240,000. Willis uses the direct method to allocate service center costs to operating departments. Other relevant data follow.

Required
a. Allocate the service center costs to the operating departments using the number of pages as the cost driver.
b. Allocate the service center costs to the operating departments using the number of hours as the cost driver.

Transcribed Image Text:

Number of Pages Number of Hours Children Youth Adult 5,000 10,000 5,000