Hughes Payroll and Clerical Services $($HPCS$)$ provides payroll, bookkeeping, and other services to small businesses. HPCS financial

records show the following costs for last quarter $($QTR $1)$:

HPCS recorded $4,375$ billable hours in QTR $1$ and fixed administrative cost was $$245,000.$

Assuming no change in billable hours in the next quarter $($QTR $2),$ supplies costs are expected to increase by $5$ percent. Direct labor

costs are expected to increase by $12$ percent. Variable administration per billable hour is expected to remain the same, but fixed

administration cost is expected to decrease by $7$ percent.

Required:

a$.$ HPCS expects to bill $5,425$ hours next quarter. What are the estimated direct materials, direct labor, variable overhead, and fixed

overhead costs for next quarter $($QTR $2)?$

b$.$ Determine the total costs per billable hour for QTR $1$ and QTR $2.$

Answer is complete but not entirely correct.

Complete this question by entering your answers in the tabs below.

Required $A$

HPCS expects to bill $5,425$ hours next quarter. What are the estimated direct materials, direct labor, variable overhead, and

fixed overhead costs for next quarter $($QTR $2)?$

Note: Do not round intermediate calculations.