Job costing with multiple direct-cost categories, multiple indirect-cost pools, law firm 1 Widnes Coal costs, $12,530 (continuation
Question:
Job costing with multiple direct-cost categories, multiple indirect-cost pools, law firm 1 Widnes Coal costs, $12,530 (continuation of 5-28 and 5-29). Wigan Associates has two classifications of professional staff—
eee partners and managers. Hanley asks his assistant to examine the relative use of partners and managers on the recent Widnes Coal and St. Helen’s cases. The Widnes case used 24 partnerhours and 80 manager-hours. The St. Helen’s case used 56 partner-hours and 40 manager-hours.
Hanley decides to examine how the use of separate direct-cost and indirect-cost pools for partners and managers would have affected the costs of the Widnes and St. Helen’s cases.
Indirect costs in each cost pool would be allocated based on total hours of that category of professional labour.
‘The rates per category of professional labour are as follows:
REQUIRED 1. Compute the costs of the Widnes and St. Helen’s cases with Wigan Associates’ further refined system, with multiple direct-cost categories and multiple indirect-cost pools.
2. For what decisions might Wigan Associates find it more useful to use this job-costing approach rather than the approach in Problems 5-28 or 5-29?LO1
Step by Step Answer:
Cost Accounting A Managerial Emphasis
ISBN: 9780135004937
5th Canadian Edition
Authors: Charles T. Horngren, Foster George, Srikand M. Datar, Maureen P. Gowing