larger picture of the numbers:

5-29 Job costing with single direct-cost category, single indirect-cost pool, law firm. (LO 3) Marc and Associates is a recently formed law partnership. The managing partner of Marc and Associates has just finished a tense phone call with the president of Widnes Coal, who complained about the price charged for some legal work done for Widnes Coal. At the same time, a different client call (St. Helen's Glass) confirmed the client was very pleased with both the quality of the work and the price charged on its most recent case. Marc and Associates operates at capacity and uses a cost-based approach to pricing (billing) each job. Currently it uses a single direct-cost category (for professional labour-hours) and a single indirect-cost pool (general support). Indirect costs are allocated to cases on the basis of profensional labour-hours per case. The case files show the following: Professional labour costs at Marc and Associates are $70 an hour. Indirect costs are allocated to cases at $105 an hour. Total indirect costs in the most recent period were $21,000. Required 1. Why is it important for Mare and Associates to understand the costs associated with individual cases? 2. Compute the costs of the Widnes Coal and St. Helen's Glass cases using Marc and Associates' simple costing system. \begin{tabular}{lcc} & Widnes Coal & St. Helen's Class \\ \hline Professional labour & 104 hours & 96 hours \end{tabular}