U lollidi 10) Question Help ew Bruschi Associates is a recently formed law partnership. Bruschi Associates operates at capacity and uses a cost-based approach to pricing (billing) each job. Currently it uses a simple costing system with a single direct-cost category (professional labor hours) and a single indirect-cost pool (general support). Indirect costs are allocated to cases on the basis of professional labor-hours per case. The job files for two of Bruschi's clients, Griffin Enterprises and Quartz Inc., show the following: (Click the icon to view the data using the simple costing system.) !! (Click the icon to view additional data.) Read the requirements Quis Requirement 1. Calculate the revised indirect-cost allocation rate per professional labor hour for Bruschi Associates willen total indirect costs are $225,000 First determine the formula used to calculate the indirect-cost rate. Then enter the amounts in the formula and calculate the rate per hour (Abbreviation used: prof. = professional.) Indirect-cost rate per hour O Choose from any drop-down list and then click Check Answer. 5 parts Clear All Check Answer 5 remaining 1 Data Table ociates is a recently for ple costing system wit| cases on the basis of e icon to view the data ne icon to view addition pricing upport). In Quartz Inc Griffin Enterprises Quartz Inc. Professional labor 2,700 hours 2,300 hours Professional labor costs at Bruschi Associates are $180 an hour. Indirect costs are allocated to cases al $115 an hour. Total indirect costs in the most recent period were $575,000 quirements ent 1. Calculate the revid nine the formula used to al.) bct costs are s hour. (Abbrevia: Total cost of the jobs using the simple costing system are as follows: Griffin Quartz Enterprises Inc. Direct professional labor $ 486,000 $ 414,000 Indirect costs allocated 310,500 264,500 Total $ 796,500 $ 678,500 om any drop-down list ning Print | Done Check Answer sis of ne data addition Cindy Hagwood, the managing partner of Bruschi Associates, asks her assistant to collect details on those costs included in the $575,000 indirect-cost pool that can be traced to each individual job. After analysis, Bruschi is able to reclassify $350,000 of the $575,000 as direct costs: Other Direct Costs the revi Quartz Inc. used to Research support labor Computer time Travel and allowances Telephones/faxes Photocopying Griffin Enterprises 38,000 $ 7,000 11,000 143,800 30,000 76,000 21,000 14,100 3,000 6,100 Total 65,100 $ 284,900 own list Print Print Done Done Chi ...viprises Research support labor Quartz Inc. 143,800 Computer time Travel and allowances 30,000 38,000 $ 7,000 11,000 3,000 6,100 Telephones/faxes 76,000 21,000 14,100 Photocopying Total 65,100 $ 284,900 Hagwood decides to calculate the costs of each job as if Bruschi had used six direct-cost pools and a single indirect-cost pool. The single indirect-cost pool would have $225,000 of costs and would be allocated to each case using the professional labor-hours base. Print Done HWE -to) a recently formed law partnership. Bruschi Associates operates at capacity and uses a cost-based approach to pricing ng system with a single direct-cost category (professional labor-hours) and a single indirect-cost pool (general support). the basis of pro Quartz view the data y A Requirements view additional nts. culate the revise lirect costs ormula used to a 1. Calculate the revised indirect-cost allocation rate per professional labor-hour for Bruschi Associates when total indirect costs are $225,000. 2. Compute the costs of the Griffin Enterprises and Quartz Inc. jobs if Bruschi Associates had used its refined costing system with multiple direct-cost categories and one indirect-cost pool. 3. Compare the costs of Griffin Enterprises and Quartz Inc. jobs in requirement 2 with those calculated using the simple costing system. Comment on the results. r hour. (Abb. Print Done drop-down list and then click Check Answer. Clear All Check A
