Instructions: Complete steps a, b, &c assigning overhead cost under traditional and ABC cost assignment methods for Lopez Company with the information provided below. (blue shaded fields are calculated values) Expected use of Cost Drivers overhead data r Law Service Total Estimated use of Cost Overhead Rich and Richer is a law firm that serves both individuals and corporations. A controversy has developed between the partners of the two service lines as to who is contributing the greater amount to the bottom line. The area of contention is the assignment of overhead. y Cost Pool Cost Driver Drivers Individual Direct Labor dollars 120,000 1,500,000 900,000 500 17,000 600,000 500 23,000 and secretaria Number of re 2,000 40,000 Number of minutes Number of em Per expense reports submitted 100,000 100,000 The individual partners argue for assigning overhead on the basis of 32.2% of direct labor dollars, while the corporate partners argue for implementing activity-based costing. Tho partners agree to use next year's budgeted data for purposes of analysis and comparison. The overhead data (to the right) are collected to develop the rental Travel 70,000 450,000 48,000 22,000 Total Corporate Individual a) Using traditional product costing as proposed by the law partners, compute the total overhead cost assigned to both services (individual and corporate) of Rich and Richer (al Computation of assigned overhead under traditional costing (based on DLS Predetermined overhead rate X direct labor dollars) Predetermined overhead rate Direct labor dollars b) (1) Using activity-based costing, prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). b) (2) Prepare a schedule assigning each activity's overhead cost pool to each service based on the use of the cost drivers. Total overhead cost assigned to each service (individual and corpo S 450,000 (b) (1) Computation of Activity-Based Overhead rates: c) Comment on the comparative overhead cost per unit for the two products under both traditional costing and ABC. Expected | = Activity. Use ofCost Drivers perOverhead Based Cost Pools Estimated Overead 120,000 1,500,000 2,000 40,000 ng and secretarial 60,000 100,000 100,000 Facility rental Travel Totals 0,000 use direct (2) Assignment of overhead to corporate and individual Law services Individual Expected Use of Cost Overhead Cost Expected Use of OverheadCost Assigned Activity Cost Pools Rate Cost Drver Rate trainin Tvping and secretarial Facility rental Travel Totals (c) Overhead is assigned to the two service lines as follows: Individual Traditional costing ABC Please comment your analysis of the difference between Traditional and ABC overhead cost assignments in (cabove