Kidman & Associates is a law firm specializing in labor relations and employee-related work. It employs 25 professionals (10 partners and 15 associates) who work directly with its clients. The average budgeted total compensation per professional for 2011 is $119,000. Each professional is budgeted to have 1,750 billable hours to clients in 2011. All professionals work for clients to their maximum 1,750 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 2011 is $2,187,500. Requirements 1. Identify the components of the overview diagram of the job-costing system at Kidman & Associates. 2. Compute the 2011 budgeted direct-cost rate per hour of professional labor. 3. Compute the 2011 budgeted indirect-cost rate per hour of professional labor. 4. Kidman & Associates is considering bidding on two jobs: a. Litigation work for Richardson, Inc., which requires 90 budgeted hours of professional labor b. Labor contract work for Punch, Inc., which requires 145 budgeted hours of professional labor. Prepare a cost estimate for each job. Requirement 2. Compute the 2011 budgeted direct-cost rate per hour of professional labor. Select the formula to compute the t Budgeted direct- Budgeted compensation per professional 1. Budgeted direct labor-hours per professional cost rate per hour 119,000 1,750 = $ 68 per hour Requirement 3. Compute the 2011 budgeted indirect-cost rate per hour of professional labor. Select the formula to compute the Budgeted indirect- Budgeted indirect costs 1. Budgeted total direct labor-hours cost rate per hour 2,187,500 43,750 = $ 50 per hour Requirement 4. Prepare a cost estimate for the Richardson, Inc. job, which requires 90 budgeted hours of professional labor and for the Punch, Inc. job, which requires 145 budgeted hours of professional labor. Richardson Direct costs Indirect costs Total costs