=+6-41 KK Job costing with multiple direct cost categories, single indirect cost pool, law firm (continuation of
Question:
=+6-41 KK Job costing with multiple direct cost categories, single indirect cost pool, law firm
(continuation of 6-40) OBJECTIVE 5 James Fox asks his assistant to collect details on those costs included in the $21000 indirect cost pool that can be traced to each individual job. After analysis, Boyce & Strong is able to reclassify $14000 of the $21000 as direct costs:
Other direct costs Jade Publishing Optical Solutions Research support labour $1 600 $3 400 Computer time 500 1 300 Travel and allowances 600 4 400 Telephones/faxes 200 1 000 Photocopying 250 750 Total $3 150 $10 850 James decides to calculate the costs of each job as if Boyce & Strong had used six direct cost pools and a single indirect cost pool.
The single indirect cost pool would have $7000 of costs and would be allocated to each case using the professional labour-hours base.
252 Chapter 6: Activity-based costing and activity-based management M06_HORN3377_02_LT_C06.indd 252 2/09/13 3:26 PM Required 1 What is the revised indirect cost allocation rate per professional labour-hour for Boyce & Strong when total indirect costs are
$7000?
Step by Step Answer:
Cost Accounting A Managerial Emphasis
ISBN: 9781442563377
2nd Edition
Authors: Monte Wynder, Madhav V. Rajan, Srikant M. Datar, Charles T. Horngren, William Maguire, Rebecca Tan