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2) Computing direct cost rates, consulting firm. Doherty & Companyis an international consulting firm.Its 2007 annual budget includes the following for each category of professionnal

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2) Computing direct cost rates, consulting firm. Doherty & Companyis an international consulting firm.Its 2007 annual budget includes the following for each category of professionnal labour. Unbilled Time Average Billable Vacation Professional Due to Average Fringe Time for and Sick Development Lack of Category Salary Benefits Clients (hours) Leave (hours) (hours) Demand 240 0 0 Director $140,000 $60,000 Partner 105,000 45,000 Manager 60,000 20,000 Assistant 38,000 2,000 1,600 1,600 1,600 1,600 160 160 160 160 240 240 240 0 0 REQUIRED 1. Compute the budgeted direct cost rate for professional labour (salary and fringe benefits ) per hour for (a) directors , (b ) partners , (c) managers , and (d) assistants. Use budgeted billable time for clients as the denominator in these computations. 2. Repeat requirement 1. Use the sum of budgeted billable time, vacation and sick leave time, and professional development time as the denomina- tor in these calculations 3. Why are the rates different between requirements 1 and 2? How might these differences affect job costing by Doherty & Company

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