Polk and Stoneman _ABC Costing

Polk and Stoneman is a public 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. 

Using traditional product costing as proposed by the tax partners, compute the total overhead cost assigned to both services (audit and tax) of Polk and Stoneman.

(1) Using activity-based costing compute the activity-based overhead rates (per cost driver).

(2) Complete the schedule assigning each activity's overhead cost pool to each product based on the use of cost drivers. (Round the activity-based overhead rates to 3 decimal places, e.g. 2.250 and cost assigned to 0 decimal places, e.g. 12,500. Note due to rounding total cost assigned may be slightly different than from above.)