Crady Solutions designs Web pages for clients in the education sector. The company's job-costing system has a single direct cost category (Web-designing labor) and a single indirect cost pool composed of all overhead costs. Overhead costs are allocated to individual jobs based on direct labor-hours. The company employs six Web designers. Budgeted and actual information regarding Crady Solutions follows:

Budget for 2017: Direct labor costs Direct labor-hours Overhead costs $280,000 10,000 $180,000 $260,000 Actual results for 2017: Direct labor costs Direct labor-hours Overhead costs 10,000 $200,000 Requirement 1. Compute the direct-cost rate and the indirect-cost rate per Web-designing 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. Begin by identifying the formula to calculate the actual indirect-cost rate. = Actual indirect-cost rate Identify the formula to calculate the budgeted indirect-cost rate. Budgeted indirect-cost rate Identify the formula to calculate the budgeted direct-cost rate. = Budgeted direct-cost rate Compute the direct-cost rate and the indirect-cost rate per labor hour under: (a) Actual (b) Normal costing (c) Variation of normal costing costing Direct-cost rate Indirect-cost rate Requirement 2. Which method would you suggest Crady Solutions use? Explain. Crady Solutions should choose a job-costing system based on the information available to them. If Crady Solutions knows as the jobs are being done, I would recommend Crady Solutions use by calculating a to cost jobs. enables Crady Solutions to use the V to estimate the cost of a job as soon as the job is completed. If Crady Solutions does not know as the jobs are being completed, I would recommend that This Crady Solutions use the would allow Crady Solutions to estimate costs on a more-timely basis. Requirement 3. Crady Solutions' Web design for Greenville Day School was budgeted to take 95 direct labor-hours. The actual time spent on the project was 80 hours. Compute the cost of the Greenville Day School job using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Begin by identifying the formulas to calculate the direct and indirect-costs under actual costing. (a) Actual costing: Direct-costs = Indirect-costs = Identify the formulas to calculate the direct and indirect-costs under normal costing. (b) Normal costing: Direct-costs = Indirect costs = Identify the formulas to calculate the direct and indirect-costs under the variation of normal costing. (c) Variation of normal costing: Direct-costs = Indirect-costs = L What would the cost of this job be under each of the costing methods in requirement 1? (c) (a) Actual Normal Variation of normal costing costing costing Cost of Crady Solutions: Direct-costs Indirect-costs Total job costs Budget for 2017: Direct labor costs Direct labor-hours Overhead costs $280,000 10,000 $180,000 $260,000 Actual results for 2017: Direct labor costs Direct labor-hours Overhead costs 10,000 $200,000 Requirement 1. Compute the direct-cost rate and the indirect-cost rate per Web-designing 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. Begin by identifying the formula to calculate the actual indirect-cost rate. = Actual indirect-cost rate Identify the formula to calculate the budgeted indirect-cost rate. Budgeted indirect-cost rate Identify the formula to calculate the budgeted direct-cost rate. = Budgeted direct-cost rate Compute the direct-cost rate and the indirect-cost rate per labor hour under: (a) Actual (b) Normal costing (c) Variation of normal costing costing Direct-cost rate Indirect-cost rate Requirement 2. Which method would you suggest Crady Solutions use? Explain. Crady Solutions should choose a job-costing system based on the information available to them. If Crady Solutions knows as the jobs are being done, I would recommend Crady Solutions use by calculating a to cost jobs. enables Crady Solutions to use the V to estimate the cost of a job as soon as the job is completed. If Crady Solutions does not know as the jobs are being completed, I would recommend that This Crady Solutions use the would allow Crady Solutions to estimate costs on a more-timely basis. Requirement 3. Crady Solutions' Web design for Greenville Day School was budgeted to take 95 direct labor-hours. The actual time spent on the project was 80 hours. Compute the cost of the Greenville Day School job using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Begin by identifying the formulas to calculate the direct and indirect-costs under actual costing. (a) Actual costing: Direct-costs = Indirect-costs = Identify the formulas to calculate the direct and indirect-costs under normal costing. (b) Normal costing: Direct-costs = Indirect costs = Identify the formulas to calculate the direct and indirect-costs under the variation of normal costing. (c) Variation of normal costing: Direct-costs = Indirect-costs = L What would the cost of this job be under each of the costing methods in requirement 1? (c) (a) Actual Normal Variation of normal costing costing costing Cost of Crady Solutions: Direct-costs Indirect-costs Total job costs