1 Job Costing 2 Job Costing; Actual, Normal, and Variation from Normal Costing 3 Cheney & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Cheney & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2017 can be found on the "BUDGETACTUAL" tab. 6 Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions or Budgetactual tab you will be marked wrong. 9 Requirements 1 Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2017 under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. 10 2 Cheney's 2017 audit of Pierre & Co. was budgeted to take 170 hours of professional labor time. The actual professional labor time spent on the audit was 185 hours. Compute the cost of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. 11 12 13 Saving & Submitting Solution 14 1 Save file to desktop. 15 a. Create folder on desktop, and label COMPLETED EXCEL PROJECTS 16 2 Upload and submit your file to be graded. 17 a. Navigate back to the activity window - screen where you downloaded the initial spreadsheet b. Click Choose button under step 3; locate the file you just saved and click Open 18 19 c. Click Upload button under step 3 20 d. Click Submit button under step 4 21 456 789 F 13 56 D H A B 1 **DATA SHEET -- DO NOT ENTER ANSWERS HERIE** 2 Budgeted and actual amounts for 2017 are as follows: 3 4 Cheney & Partners 5 Budget for 2017 6 Professional labor compensation 7 Audit support department costs 8 Professional labor-hours billed to clients 9 10 Actual results for 2017 11 Audit support department costs 12 Professional labor-hours billed to clients 13 Actual professional labor cost rate 14 15 $960,000 720,000 C 16,000 hours 15,500 hours $53 per hour $744,000 2. Cheney's 2017 audit of Pierre & Co. was budgeted to take 170 hours of professional labor time. The actual professional labor time spent on the audit was 185 hours. Compute the cost of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the 1 Instructions or Budgetactual tab you will be marked wrong.) 2 3 (c) 4 (a) (b) Variation of Normal Costing Cost of Pierre audit: Actual Costing Normal Costing 5 6 Direct-costs 7 Indirect-costs 18 Total job costs 19 on