KV Accounting and Business Consultants provides a variety of consulting services to a diverse range of clients. The company has three support departments and three revenue-generating departments, whose cost details for a typical quarter are presented below: Support Departments $281,500 IT Support Adein Support Facilities Support 712,000 200,550 Revenue-Generating Departments Assurance 858,900 Tax Advisory 617,000 784,800 Business Advisory $3,454,750 The existing cost allocation system is designed as follows: (1) the support department costs are allocated to the three revenue- generating departments, and (2) the revenue-generating department costs are allocated to individual clients. The support department costs are allocated to the revenue-generating departments as follows: (1) IT Support costs are allocated to Assurance, Tax Advisory. and Business Advisory using a 35:35:30 ratio, (2) Admin Support costs are allocated using a 40:30:30 ratio, and (3) Facilities Support costs are allocated using a 40:40.20 ratio. The costs accumulated in the three revenue-generating departments are allocated to individual clients based on the professional time consumed in the respective department. The Assurance, Tax Advisory, and Business Advisory departments recorded 9,900. 8,400, and 6,900 hours, respectively, for the quarter. Required: wers to 2 de 2 decimal 1. Compute the predetermined cost allocation rates for the three revenue-generating departments (Round your answers places) Predetermined Cost Allocation Rate Assurance Tax Advisory Business Advisory 198 2. Using the rates computed in Requirement (1) above, assign the costs to clients X and Y. Client X required 430, 570 and 690 hours of professional time, respectively, in the Assurance, Tax Advisory and Business Advisory departments, whereas client Y required 690, 840 and 290 hours of professional time. (Do not round intermediate calculations. Round your answers to the nearest whole dollar) Client X Client Y Assurance Service Tax Advisory Service Business Advisory Service $ 0 $ 0 3. You have recently learned about activity-based costing and decide to use six activity cost pools, one for each department. The additional information you have collected is as follows: 22 Activity Cost Pool. Cost Driver (allocation base) Allocation Base Quantity IT Support IT time 16,350 hours Admin Support Sales revenue Facilities Support Assurance Total professional time Assurance professional time $69.53 million 23,820 hours 9,900 hours. 8,400 hours Tax Advisory Business Advisory Tax advisory professional time Business advisory professional time 6,900 hours Compute the predetermined allocation rate for each activity cost pool. (Round your answers to 2 decimal places.) Activity Cost Pool Activity Rate IT Support por IT support hour Admin Support % of sales revenue per hour of professional time Facilities Support Assurance per hour of assurance professional time Tax Advisory per hour of tax advisory professional time Business Advisory per hour of business advisory professional time 4. In addition to the Assurance, Tax Advisory, and Business Advisory time specified in Requirement (2) above, the two clients consumed the following additional resources: Resource Client X Client Y 240 IT time (hours) Sales revenue 440 $1,464,300 $976,200 Assign the costs to the two clients using activity-based costing. (Round intermediate calculations to 2 decimal places and final answers to the nearest dollar amount.) Client X Client Y IT Support Admin Support Facilities Support Assurance Tax Advisory Business Advisory S 05 0