Departmental Cost Allocation; Insurance Company CareMark Insurance Company has two p...

Departmental Cost Allocation; Insurance Company CareMark 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 services: claims processing, administration, and sales. These three operating departments are supported by two departments: information technology and facilities. The support provided by information technology and facilities to the other departments is shown below.

Required Use 4 decimal places (e.g., 33.3333%) in your calculations. Allocate the $4,175,000 total departmental costs to the three operating departments using (a) the direct method, (b) the step method (once for information technology and once for facilities going first in the allocation), and (c) the reciprocal method.