Job costing; actual, normal, and variation from normal costing. Braden Brothers, Inc., is an architecture firm specializing in high-rise buildings. Its job-costing system has a single direct-cost category (architectural labor) and a single indirect-cost pool, which contains all costs of supporting the office. Support costs are allocated to individual jobs using architect labor-hours. Braden Brothers employs 15 architects.

Budgeted and actual amounts for 2010 are as follows:Required1. Compute the direct-cost rate and the indirect-cost rate per architectural labor-hour for 2010 under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs.2. Braden Brother's architectural sketches for Champ Tower in Houston was budgeted to take 275 hours of architectural labor time. The actual architectural labor time spent on the job was 250 hours. Compute the cost of the Champ Tower sketches using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for directcosts.

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Braden Brothers, Inc. Budget for 2010 Architect labor cost S2,880,000 Office support costs S1,728,000 Architect labor-hours billed to clients 32,000 hours Actual results for 2010 Office support costs $1,729,500 34,590 hours 92 per hour Architect labor-hours billed to clients Actual architect labor cost rate %24