=+6-41 KK Job costing with multiple direct cost categories, single indirect cost pool, law firm (continuation of

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=+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?

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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

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