Kirac & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Kirac & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2020 are as follows: (Click the icon to view the data.) Read the requirements Requirement 1. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2020 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 Identify the formula to calculate the budgeted indirect-cost rate Actual 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 professional labor-hour for 2020 under each method Direct-cost rate Indirect-cost rate (a) Actual (b) Normal Costing Costing (c) Variation of Normal Costing Requirement 2. Which job-costing system would you recommend Kirac & Partners use? Explain. Kirac & Partners should choose a job-costing system based on the use by calculating a information available to them. If Kirac knows as the jobs are being done, I would recommend Kiraci to cost jobs enables Kirac to use the Kirac & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Kirac & Partners employs 101 professionals to perform audit services. Budgeted and actual amounts for 2020 are as follows: (Click the icon to view the data.) Read the requirements. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2020 under each method. (a) Actual (b) Normal (c) Variation of Costing Costing Normal Costing Direct-cost rate Indirect-cost rate Requirement 2. Which job-costing system would you recommend Kirac & Partners use? Explain. Kirac & Partners should choose a job-costing system based on the information available to them. If Kirac knows use by calculating a to cost jobs as the jobs are being done, I would recommend Kirac enables Kirac to use the If Kirac does not know to estimate the cost of a job as soon as the job is completed as the jobs are being completed, I would recommend that Kirac use the This would allow Kirac to estimate costs on a more-timely basis. Requirement 3. Kirac's 2020 audit of Pierre & Co. was budgeted to take 180 hours of professional labor time. The actual professional labor time spent on the audit was 195 hours. Compute the cost of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Explain any offerences in the job cost Begin by identifying the formulas to calculate the direct and indirect-costs under actual costing (a) Actual Costing Direct-costs Indirect-costs Kirac & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Kirac & Partners employs 1C professionals to perform audit services. Budgeted and actual amounts for 2020 are as follows: (Click the icon to view the data.) Read the requirements. Kirac & Partners should choose a job-costing system based on the information available to them. If Kirac knows use by calculating a to cost jobs as the jobs are being done, I would recommend Kirac enables Kirac to use the to estimate the cost of a job as soon as the job is completed. as the jobs are being completed, I would recommend that Kirac use the This would If Kirac does not know allow Kirac to estimate costs on a more-timely basis Requirement 3. Kirac's 2020 audit of Pierre & Co. was budgeted to take 180 hours of professional labor time. The actual professional labor time spent on the audit was 195 hours. Compute the cos of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Explain any differences in the job cost. 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 Kirac & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Kirac & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2020 are as follows: (Click the icon to view the data.) Read the requirements 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 Compute the cost of the Pierre & Co. audit under each of the three methods. (a) Actual (b) Normal (c) Variation of Cost of Pierre audit: Costing Costing Normal Costing Direct-costs Indirect-costs Total job costs the actual professional labor time of 195 hours. The budgeted 180 hours The actual costing figure of actual indirect-cost rate of The normal costing figure of the actual direct-cost rate of the normal costing figure of the budgeted indirect-cost rate of the variation of normal costing figure of the budgeted direct-cost rate of This is because the This is because Kirac & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. Kirac & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2020 are as follows: (Click the icon to view the data.) Read the requirements. Requirements 1. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2020 under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. 2. Which job-costing system would you recommend Kirac & Partners use? Explain 3. Kirac's 2020 audit of Pierre & Co. was budgeted to take 180 hours of professional labor time. The actual professional labor time spent on the audit was 195 hours. Compute the cost of the Pierre & Co. audit using (a) actual costing. (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Explain any differences in the job cost. Data table Budget for 2020 Professional labor compensation Audit support department costs Professional labor-hours billed to clients Actual results for 2020 Audit support department costs Professional labor-hours billed to clients Actual professional labor cost rate $ 990,000 $ 774,000 18.000 hours 735,000 17,500 hours $59 per hour Print Done the actual profession Print Done The actual costing figure of actual indirect-cost rate of The normal costing figure of the actual direct-cost rate of the normal costing figure of the budgeted indirect-cost rate of the variation of normal costing figure of the budgeted direct-cost rate of This is because the This is because