The managing partner of Singh Accounting is considering the desirability of tracing more costs to jobs than just direct labour. In this way, the firm will be better able to justify billings to clients.

Transcribed Image Text:

Last year's costs were Direct professional labour Overhead $ 5,000,000 10,000,000 Total costs $15,000,000 The following costs were included in overhead: Computer time Secretarial costs Photocopying $ 750,000 700,000 250,000 Employee benefit costs for direct labour 800,000 Phone call time with clients (estimated but not tabulated) Total 500,000 $3,000,000