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K Mattius & Gades (MG) is a law firm that specializes in writing wills. Its job-costing system has one direct cost pool, professional labour,
K Mattius & Gades (MG) is a law firm that specializes in writing wills. Its job-costing system has one direct cost pool, professional labour, and a single indirect cost pool that includes all supporting costs of running the law office. The support costs are allocated to clients on the basis of professional labour-hours. In addition to the two senior partners at MG, there are six associates who work directly with clients. Each of the eight lawyers is expected to work for approximately 2,500 hours a year. Budgeted and actual costs for the year were as follows: (Click the icon to view the budgeted and actual costs.) Required Required 1. Compute the direct cost rate and the indirect cost rate per professional labour-hour under a. Actual costing b. Normal costing c. Budgeted costing 2. The will for a rich tycoon, Ari Roos, was very complex and took three lawyers at the firm 800 hours each to prepare. What would be the cost of writing this will under each of the costing methods in requirement 1? Print Done - ... Budgeted and actual costs - Budgeted professional labour costs 1,300,000 Budgeted support costs 2,200,000 Actual professional labour costs 1,350,000 Actual support costs $ 2,781,000 Actual total professional hours 27,000 hours he Print Done
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