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Curtis & Company is an architectural firm specializing in home remodeling for private clients and new office buildings for corporate clients. Curtis charges customers at

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Curtis & Company is an architectural firm specializing in home remodeling for private clients and new office buildings for corporate clients. Curtis charges customers at a Annika Larson hired Curtis to design her kitchen remodeling. A total of 25 professional hours were incurred on this job. In addition, Larson's remodeling job required one of billing rate equal to 126% of the client's total job cost. A client's total job cost is a combination of (1) professional time spent on the client (566 per hour cost of employing the professionals to travel back and forth to her house for a total of 145 miles. The blueprints had to be copied four times because Larson changed the plans several times. each professional) and (2) operating overhead allocated to the client's job. Curtis allocates operating overhead to jobs based on professional hours spent on the job. In addition, 18 hours of secretarial time were used lining up the subcontractors for the job. Curtis estimates its five professionals will incur a total of 10,000 professional hours working on client jobs during the year. (Click the icon to view the operating cost information.) Read the requirements CHILD Requirement 1. Calculate the current indirect cost allocation rate per professional hour. (Round your answer to the nearest cent.) The current indirect cost allocation rate per professional hour is 25.6 Data Table Requirement 2. Calculate the total amount that would be billed to Larson given the current costing structure Determine the formula, then calculate the amount that would be billed to Larson given the current costing structure. (Round all amounts to the nearest cent.) Total cost of job Markup percentage Amount billed to client 126% Requirement 3. Calculate the activity cost allocation rates that could be used to allocate operating overhead costs to client jobs. Determine the formula, then calculate the activity cost allocation rates that could be used to allocate operating overhead costs to client jobs. (Round the rates to the nearest cent.) All operating costs other than professional salaries (travel reimbursements, copy costs, secretarial salaries, office lease, and so forth) can be assigned to the three activities. Total activity costs, cost drivers, and total usage of those cost drivers are estimated as follows: Total Activity Total Usage by Total Usage by Private Activity Cost Cost Driver Corporate Clients Clients Transporation to clients... $ 9,000 Round-trip mileage to clients 5,500 miles 9,500 miles Blueprint copying 37.000 Number of copies. 650 copies Office support 2,400 secretarial hours 2,600 secretarial hours $ 250.000 Total operating overhead 350 copies 210.000 Secretarial time Transportation to clients Blueprint copying Office support Activity cost allocation rate per mile per copy = per secretarial hour Requirement 4. Calculate the amount that would be billed to Larson using ABC costing. Determine the formula, then calculate the amount that would be billed to Larson using ABC costing. (Round all amounts to the nearest cent.) Print Done = Amount billed to client Requirement 5. Which type of billing system is more fair to clients? Explain. The billing system is more fair to clients because they are charged according to For example, copying blueprints is V. Under the fairer system, clients are charged V blueprint copies that their job required. The fairer system better recognized the extent to which costs are incurred by each unique client job

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