Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Washington Co. employs ten full-time professionals. The budgeted compensation per employee is $60,000. The maximum billable hours for each client are 400. Clients always receive

Washington Co. employs ten full-time professionals. The budgeted compensation per employee is $60,000. The maximum billable hours for each client are 400. Clients always receive their full amount of time. All professional labor costs are included in a single direct-cost category and are traced to jobs on a per-hour basis. Any other costs are included in a single indirect-cost pool, allocated according to professional labor-hours. Budgeted indirect costs for the year are $200,000 and the firm had 25 clients.

a. What is the direct-labor-cost rate per hour?

b. What is the indirect-cost rate per hour?

c. What is the total cost incurred to the employer per hour?

d. How will the total cost be affected if the firm loses out on 4 clients?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Money Laundering Prevention Deterring Detecting And Resolving Financial Fraud

Authors: Jonathan E. Turner

1st Edition

0470874759, 978-0470874752

More Books

Students also viewed these Accounting questions