Lewis and Stark is a public accounting firm that offers two primary services, auditing and tax-return preparation. 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. The tax partners argue for assigning overhead on the basis of 40% of direct labor dollars, while the audit partners argue for implementing activity-based costing. The partners agree to use next year's budgeted data for purposes of analysis and comparison. The following overhead data are collected to develop the comparison. Estimated Use of Cost Drivers per Service Estimated Overhead Cost Drivers Audit Activity Cost Pools Employee training Typing and secretarial Computing Facility rental Travel Direct labor dollars Number of reports/forms Number of minutes Number of employees Per expense reports $200.750 76,300 224,400 147,000 81,550 $ 730,000 Estimated Use of Cost Drivers $1,825,000 2,500 60,000 40 $1,104,000 800 27.000 22 56,000 Tax $721,000 1,700 33,000 18 25,300 Direct (a) (51) Using activity-based costing, prepare a schedule showing the computations of the activity based overhead rates (per cost driver). (Round overhead rates to 2 decimal places, eg. 12.25.) Estimated Overhead Activity Cost Pools Employee training Typing and secretarial Expected Use of Cost Drivers per Activity Direct labor dollars Activity-Ba Overhead R $ $ Reports/forms $ Computing Minutes $ Facility rental Employees $ Travel Direct Direct $ (51) Using activity-based costing, prepare a schedule showing the computations of the activity based overhead rates (per cost driver). (Round overhead rates to 2 decimal places, e.g. 12.25.) Estimated Overhead Expected Use of Cost Drivers per Activity Direct labor dollars Activity-Based Overhead Rates $ per DL Reports/forms $ dollar per report/form Minutes $ per minute Employees $ per employee Direct Direct