Question
Smith and Jones CPA firm employs 12 accountants and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both
Smith and Jones CPA firm employs 12 accountants and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both attorney and paraprofessional hours. Following is information for 2018:
| Budget | Actual |
| Indirect costs | $290,000 | $310,000 |
| Annual salary of each attorney | $90,000 | $105,000 |
| Annual salary of each paraprofessional | $32,000 | $33,000 |
| Total professional labor-hours | 20,000 | dlh | 25,000 | dlh |
What are the actual direct-cost rate and the actual indirect-cost rate, respectively, per professional labor-hour?
A. $70.00; $14.50
B. $79.50; $12.40
C. $63.60; $11.60
D. $63.60; $12.40
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Auditing Principles A Systems Based Approach
Authors: Howard F. Stettler
5th Edition
0130517224, 9780130517227
