Can you help explain the calculations
Data Table Budget for 2020 Professional labor compensation Audit support department costs Professional labor-hours billed to clients $ 960,000 $ 720,000 16,000 hours $ Actual results for 2020 Audit support department costs Professional labor-hours billed to clients Actual professional labor cost rate 744,000 15,500 hours $51 per hour Chico & 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. Chico & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2020 as follows: Click the icon to view the data.) Read the requirements. Requirement 1. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2020 under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Begin by identifying the formula to calculate the actual indirect-cost rate. Actual indirect-costs Actual direct labor-hours Actual indirect-cost rate Identify the formula to calculate the budgeted indirect-cost rate Budgeted indirect-costs Budgeted direct labor-hours Budgeted indirect-cost rate Identify the formula to calculate the budgeted direct-cost rate. Budgeted direct costs Budgeted direct labor-hours Budgeted direct-cost rate Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2020 under each method. (b) (a) Actual Normal Costing Costing 51 (c) Variation of Normal Costing $ 60 $ 45 Direct-cost rate $ 51 $ Indirect-cost rate $ 48 $ 45 Requirement 3. Chico's 2020 audit of Pierre & Co. was budgeted to take 170 hours of professional labor time. The actual professional labor time spent on the audit was 180 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. Explain any differences in the job cost. Begin by identifying the formulas to calculate the direct and indirect-costs under actual costing. (a) Actual Costing: = Direct-costs Indirect-costs Actual direct-cost rate Actual indirect-cost rate Actual qty of direct-cost inputs Actual qty of cost-allocation bases Identify the formulas to calculate the direct and indirect-costs under normal costing. (b) Normal Costing: Direct-costs Actual direct-cost rate Actual qty of direct-cost inputs Indirect-costs Budgeted indirect-cost rate Actual qty of cost-allocation bases Identify the formulas to calculate the direct and indirect-costs under the variation of normal costing. (c) Variation of Normal Costing Direct-costs Budgeted direct-cost rate Indirect-costs Budgeted indirect-cost rate Actual qty of direct-cost inputs Actual qty of cost-allocation bases Compute the cost of the Pierre & Co. audit under each of the three methods. Cost of Pierre audit: : Direct-costs (a) Actual Costing 9.180$ 8,640 (b) (c) Normal Variation of Costing Normal Costing 9,180 $ 10,800 8,100 8,100 $ Indirect-costs $ 17.820's 17,280's 18,900 Total job costs All three costing systems use the actual professional labor time of 180 hours. The budgeted 170 hours is not used in job costing The actual costing figure of actual indirect-cost rate of $ 17,820 exceeds S 48 exceeds the normal costing figure of the budgeted indirect-cost rate of $ 17,280 This is because the S 45 $ 18,900. This is because The normal costing figure of the actual direct-cost rate of $ 17,280 is less than the variation of normal costing figure of S 51 is less than the budgeted direct-cost rate of $ 60
