Professional Labor Cost Budget for a Service Company

Lundquist & Fretwell, CPAs, offer three types of services to clients: auditing, tax, and small business accounting. Based on experience and projected growth, the following billable hours have been estimated for the year ending May 31, 20Y8:

		Billable Hours
Audit Department:
	Staff	25,000
	Partners	6,000
Tax Department:
	Staff	40,000
	Partners	8,500
Small Business Accounting Department:
	Staff	5,000
	Partners	500

Based on the data provided above and assuming that the average compensation per hour for staff is $40 and for partners is $175, prepare a professional labor cost budget for each department for Lundquist & Fretwell, CPAs, for the year ending May 31, 20Y8.

Lundquist & Fretwell, CPAs
Professional Labor Cost Budget
For the Year Ending December 31, 20Y8
	Staff	Partners
Audit Department hours
Tax Department hours
Small Business Accounting Department hours
Total hours
Average compensation per hour	x $	x $
Total professional labor cost	$	$