Grady and Associates, performs a variety of activities related to information systems and e$-$commerce consulting in Toronto, Canada. The firm, which bills $$152$ per hour for services performed, is in a very tight local labor market and is having difficulty finding quality help for its overworked professional staff. The cost per hour for professional staff time is $$62.$ Selected information follows.

Billable hours to clients for the year totaled $7,200,$ consisting of information systems services, $4,320$; e$-$commerce consulting, $2,880.$

Administrative cost of $$399,760$ was $($and continues to be$)$ allocated to both services based on billable hours. These costs consist of staff support, $$214,920$; in$-$house computing, $$151,000$; and miscellaneous office charges, $$33,840.$

A recent analysis of staff support costs found a correlation with the number of clients served. In$-$house computing and miscellaneous office charges varied directly with the number of computer hours logged and number of client transactions, respectively. A tabulation revealed the following data:

$\backslash$table$[[,\backslash$table$[[$Information Systems$],[$E$-$Commerce$],[$Consulting$]],$Total,$],[$Number of clients,$270,90,360],[$Number of computer hours,$3,320,2,220,5,540],[$Number of client transactions,$600,780,1,380]]$

Required:

$2.$ Assume that the firm uses traditional costing procedures, allocating total costs on the basis of billable hours. Determine the profitability of the firm's information systems and e$-$commerce activities, expressing your answer both in dollars and as a percentage of activity revenue.

Required:

$2.$ Assume that the firm uses traditional costing procedures, allocating total costs on the basis of billable hours. Determine the profitability of the firm's information systems and e$-$commerce activities, expressing your answer both in dollars and as a percentage of activity revenue.

$3.$ Assume that the firm uses activity$-$based costing. Determine the profitability of the firm's e$-$commerce and information systems activities, expressing your answer both in dollars and as a percentage of activity reveue.