Needing help with an extensive Cost Accounting Question

2. Student: Tim Weaver Date: 03/07/22 Instructor: Rose Creps, Anita Maskar Course: ACC-311-R4835 Cost Accounting 22EW4 Assignment: 2-1 MyAccountingLab Homework: Chapter 4 & Partners, a Quebec-based public accounting partnership, specializes in audit services. Its job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (audit support, which contains all costs of the Audit Support Department). Audit support costs are allocated to individual jobs using actual professional labor-hours. & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for are as follows: Chirac Chirac 2017 1 (Click the icon to view the data.) Read the requirements2. Requirement 1. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. 2017 Begin by identifying the formula to calculate the actual indirect-cost rate. (1) / (2) = Actual indirect-cost rate Identify the formula to calculate the budgeted indirect-cost rate. (3) / (4) = Budgeted indirect-cost rate Identify the formula to calculate the budgeted direct-cost rate. (5) / (6) = Budgeted direct-cost rate Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for 2017 under each method. (a) Actual Costing Direct-cost rate Indirect-cost rate (b) Normal Costing (c) Variation of Normal Costing Requirement 2. Which job-costing system would you recommend Chirac & Partners use? Explain. & Partners should choose a job-costing system based on the (7) information available to them. If knows (8) as the jobs are being done, I would recommend use (9) by calculating a (10) to cost jobs. (11) enables to use the (12) to estimate the cost of a job as soon as the job is completed. Chirac Chirac Chirac Chirac If does not know (13) as the jobs are being completed, I would recommend that use the (14) This would allow to estimate costs on a more-timely basis. Chirac Chirac Chirac Requirement 3. 's audit of Pierre & Co. was budgeted to take hours of professional labor time. The actual professional labor time spent on the audit was hours. Compute the cost of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Explain any differences in the job cost. Chirac 2017 180 200 Begin by identifying the formulas to calculate the direct and indirect-costs under actual costing. 1: Data Table (a) Actual Costing: Direct-costs = (15) x (16) Indirect-costs = (17) x (18) Identify the formulas to calculate the direct and indirect-costs under normal costing. (b) Normal Costing: Direct-costs = (19) x (20) Indirect-costs = (21) x (22) Identify the formulas to calculate the direct and indirect-costs under the variation of normal costing. (c) Variation of Normal Costing: Direct-costs = (23) x (24) Indirect-costs = (25) x (26) Compute the cost of the Pierre & Co. audit under each of the three methods. (a) Actual Cost of Pierre audit: Costing Direct-costs Indirect-costs Total job costs (b) Normal Costing (c) Variation of Normal Costing (27) the actual professional labor time of 200 hours. The budgeted 180 hours (28) . The actual costing figure of $ (29) the normal costing figure of $ . This is because the actual indirect-cost rate of $ (30) the budgeted indirect-cost rate of $ . The normal costing figure of $ (31) the variation of normal costing figure of $ . This is because the actual direct-cost rate of $ (32) the budgeted direct-cost rate of $ . Chirac & Partners Budget for 2017 Professional labor compensation $1,120,000 Audit support department costs $688,000 Professional labor-hours billed to clients 16,000 hours Actual results for 2017 Audit support department costs $738,000 Professional labor-hours billed to clients 16,400 hours Actual professional labor cost rate $52 per hour 2: Requirements (1) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (2) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (3) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (4) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (5) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (6) Actual direct-costs Actual direct labor-hours Actual indirect-costs Budgeted direct-costs Budgeted direct labor-hours Budgeted indirect-costs (7) direct cost indirect cost (8) direct costs indirect costs (9) actual costing over normal costing normal costing over actual costing (10) budgeted direct cost rate budgeted indirect cost rate (11) Actual costing Normal costing (12) budgeted direct cost rate calculated at the beginning of the year budgeted direct cost rate calculated at the end of the year budgeted indirect cost rate calculated at the beginning of the year budgeted indirect cost rate calculated at the end of the year 1. Compute the direct-cost rate and the indirect-cost rate per professional labor-hour for under (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. 2017 2. Which job-costing system would you recommend Chirac & Partners use? Explain. 3. 's audit of Pierre & Co. was budgeted to take hours of professional labor time. The actual professional labor time spent on the audit was hours. Compute the cost of the Pierre & Co. audit using (a) actual costing, (b) normal costing, and (c) the variation from normal costing that uses budgeted rates for direct costs. Explain any differences in the job cost. Chirac 2017 180 200 (13) direct costs indirect costs (14) variation of actual costing that calculates a budgeted direct cost rate. variation of actual costing that calculates a budgeted indirect cost rate. variation of normal costing that calculates a budgeted direct cost rate. variation of normal costing that calculates a budgeted indirect cost rate. (15) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (16) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (17) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (18) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (19) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (20) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (21) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (22) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (23) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (24) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (25) Actual direct-cost rate Actual indirect-cost rate Budgeted direct-cost rate Budgeted indirect-cost rate (26) Actual qty of cost-allocation bases Actual qty of direct-cost inputs Budgeted qty of cost-allocation bases Budgeted qty of direct-cost inputs (27) All three costing systems use None of the costing systems use Only the actual costing system uses The actual costing system and the normal costing system use (28) is not used in job costing is only used in normal job costing is only used in the variation of normal job costing is used in all three systems (29) exceeds is less than (30) exceeds is less than (31) is less than exceeds (32) is less than exceeds