Francis and Hartley Law Office employs 12 full-time attorneys and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both attorney and paraprofessional hours. Following is information for 2022: Budget Actual Indirect costs $270,000 $300,000 Annual salary of each attorney $100,000 $110,000 Annual salary of each paraprofessional $29,000 $30,000 Total professional labor-hours 50,000 dlh 60,000 dlh How much should the client be billed in an actual costing system if 220 professional labor-hours are used? A) $5,940 B) $7,744 C) $8,228 D) $7,040
Francis and Hartley Law Office employs 12 full-time attorneys and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both attorney and paraprofessional hours. Following is information for 2022: Budget Actual Indirect costs $270,000 $300,000 Annual salary of each attorney $100,000 $110,000 Annual salary of each paraprofessional $29,000 $30,000 Total professional labor-hours 50,000 dlh 60,000 dlh How much should the client be billed in an actual costing system if 220 professional labor-hours are used? A) $5,940 B) $7,744 C) $8,228 D) $7,040
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 30E: A company uses charging rates to allocate service department costs to the using departments. The...
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4. Francis and Hartley Law Office employs 12 full-time attorneys and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both attorney and paraprofessional hours. Following is information for 2022:
Budget Actual
Indirect costs $270,000 $300,000
Annual salary of each attorney $100,000 $110,000
Annual salary of each paraprofessional $29,000 $30,000
Total professional labor-hours 50,000 dlh 60,000 dlh
How much should the client be billed in an actual costing system if 220 professional labor-hours are used?
A) $5,940
B) $7,744
C) $8,228
D) $7,040
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