Kidman & Associates is a law firm specializing in labor relations and employee-related work. It employs 25 professionals (7 partners and 18 associates) who work directly with its clients. Previously the firm accounted for all professional labor cost in a single direct-cost account and all other costs in a single indirect-cost pool. (Click the icon to view the cost information and rates under the previous method.) Kidman has just completed a review of its job-costing system Click the icon to view the job-costing review information) Budgeted information for 2020 related to the two direct-cost categories is Click the icon to view the budgeted information) Read the requirements as follows: Requirement 1. Compute the 2020 budgeted direct-cost rates for (a) professional partners and (b) professional associates Begin by selecting the formula, then enter the amounts to compute both rates. (Abbreviations used: Assoc. = Associate.) Budgeted direct cost rate per hour Partner por hour Assoc per hour Requirement 2. Compute the 2020 budgeted indirect-cost rates for (a) general support and (b) secretarial support Begin by selecting the formula, then enter the amounts to compute both rates. (Round your answers to the nearest whole dollar) Budgeted indirect contrato per hour per hour por hour Requirement 3. Compute the budgeted costs for the Richardson and Punch jobs based upon the hours each job is budgeted to use Richardson, Inc. Punch, Inc. Direct costs General Secretanal Professional partners Professional associates Direct-costs Click the icon to view the cost information and rates under the previous method.) Read the requirements Requirement 1. Compute the 2020 budgeted direct-cost rates for (a) professional partners and (b) professic Begin by selecting the formula, then enter the amounts to compute both rates. (Abbreviations used: Assoc. = Partner = = = Assoc. Budgeted billable hours per professional Requirem general support and (b) secretarial su Begin by s Budgeted compensation per professional th rates. (Round your answers to the ne Budgeted indirect costs = General Budgeted total direct labor-hours Secretaria Number of professionals Requirem... 11 Punch jobs based upon the hours each Richardson, Inc. Punch, Inc. Direct-costs: Professional partners Professional associates Direct-costs per hour per hour Kidman & Associates is a law firm specializing in labor relations and Kidman has just completed a review of its job-costing system w General Secretarial Requirement 3. Compute the budgeted costs for the Richardson and Punch Jobs based upon the hours each job is budgeted to use. Richardson, Inc. Punch, Inc. Direct-costs Professional partners Professional associates Direct-costs Indirect-costs General support Secretarial support Indirect costs Total costs 3 Requirement 4. Comment on the results in requirement 3. Why are the job costs different from those computed using the firm's previous method? In requirement the cost system is than the firm's previous method. The two jobs The Richardson job has a relatively higher use of and therefore the allocation method used in requirement the cost of the job when compared to the previous method Requirement 5. Would you recommend Kidman & Associates use the job-coating system in the previous method of the job costing system in this problem? Explain I would recommend that Kidman & Associates use the job costing system with two direct and two indirect cost categories. The job costing system more accurately represents the costs incurred on different jobs and therefore helps managers make bottor decisions Data Table The average budgeted total compensation per professional for 2020 is $110,000. Each professional is budgeted to have 2,000 billable hours to clients in 2020. All professionals work for clients to their maximum 2,000 billable hours available. All professional labor costs are included in a single direct-cost category and are traced to jobs on a per-hour basis. All costs of Kidman & Associates other than professional labor costs are included in a single indirect-cost pool (legal support) and are allocated to jobs using professional labor-hours as the allocation base. The budgeted level of indirect costs in 2020 is $2,250,000 The cost estimates for the Richardson, Inc. job, which requires 120 budgeted hours of professional labor and for the Punch, Inc. job, which requires 170 budgeted hours of professional labor are as follows: Direct-costs Indirect costs Richardson $ 6,600 $ 5,400 $ 12,000 $ Punch 9,350 7,650 17,000 Total costs Print Done 1. VOITTEITE UN CIC TOSUND IT TOYU OTOM J. vry or JOD COSTS UMTOTOMTOM TIOSO Computed using the TIPTOVIOUS More Info mput This review included a detailed analysis of how past jobs used the firm's resources and interviews with personnel about what factors drive the level of indirect costs. Management concluded that a system with two direct-cost categories (professional partner labor and professional associate labor) and two indirect-cost categories (general support and secretarial support) would yield more accurate job costs. ners ciate Print Done ort Click the icon to view the cost information and rates under the Click the icon to view the budgeted information.) previo Data Table Gened Secre Requi Professional Partner Labor Professional Associate Labor Number of professionals 18 Hours of billable time per professional 2,000 per year 2,000 per year Total compensation (average per professional) 243,000 90,000 Budgeted information for 2020 relating to the two indirect-cost categories is as follows: General Support Secretarial Support Total costs $ 1,980,000 270,000 Cost-allocation base Professional labor-hours Partner labor-hours Direct Prof Prol DI Indired Gen Sec Print Done Ind Total costs ethod.) Read the requirements. x Requirements 1. Compute the 2020 budgeted direct-cost rates for (a) professional partners and (b) professional associates. 2. Compute the 2020 budgeted indirect-cost rates for (a) general support and (b) secretarial support 3. Compute the budgeted costs for the Richardson and Punch jobs, given the following information: Richardson, Inc. Punch, Inc. Professional partners 48 hours 34 hours Professional associates 72 hours 136 hours 4. Comment on the results in requirement 3. Why are the job costs different from those computed using the firm's previous method? 5. Would you recommend Kidman & Associates use the job-costing system in the previous method of the job-costing system in this problem? Explain. Print Done