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Lewis and Stark is a public accounting rm that offers two primary services, auditing and tax retom preparation. A controversy has Beloped between the partners

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Lewis and Stark is a public accounting rm that offers two primary services, auditing and tax retom preparation. A controversy has Beloped 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 taxpartners argue for assigning overhead on the basis of 40% of direct labor dollars while the audit partners argue for implementing activity-based costine. The partners agree to use nect 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 Use of Cost Drivers Tax Cost Drivers Audit Activity Cost Pools Estimated Overhead $202.125 51.837.500 Direct Isbor dollars $1.100.000 $729.500 Employee training 2500 76,500 800 1.700 Typing and secretariat Number of report forms 50.000 27000 225.000 Computing 33.000 Number of minute 40 150.000 22 18 Facility rental Number of employees 81,375 Direct 56 000 Travel 25.300 Per expense reports 5735.000 (a) Your answer is correct. Using traditional product costing as proposed by the taxpartners.compute the total overhead cost assigned to both services Caudit and ad of Lewis and Stark Audit Tax 4200 291000 Total overhead costined Using tivity-based costing, prepare a schedule showing the computations of the activity based overhead rates (per cost driver (Round overhead rates to 2 decimal places es 1225) Activity Cost Pools Estimated Overhead Expected Use of Cost Drivers per Activity Activitylase Overhead Ral Employee training 5 $ Director dollars Typing and secretaria Reports/forms $ Computing Minutes $ Facility rental Employees $ Travel Direct Direct eTextbook and Media Attempts: 0 of 3 used to (62) The parts of this question must be completed in order this part will be available when you complete the part abon 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 es. 12.25) Estimated Overhead Expected Use of Cost Drivers per Activity Activity-Based Overhead Rates per DL $ Direct labor dollars $ dollar Reports forms S per report form Minutes S per minute Employees 5 per employee Direct Direct Textbook and Media Attempts:0 of 3 used Suite .for (62) Theats of queste completed london this part will be able when complete the part above

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