Allocating Overhead versus Direct Tracing Nixon & Ross, a law firm, is about to install...
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Accounting
Allocating Overhead versus Direct Tracing Nixon & Ross, a law firm, is about to install a new accounting system that will allow the firm to track more of the overhead costs to individual cases. Overhead is currently allocated to individual client cases based on billable professional staff salaries. Attorneys working on client cases charge their time to "billable professional staff salaries." Attorney time spent in training, law firm administrative meetings, and the like is charged to an overhead account titled "unbilled staff salaries." The following is a summary of the costs for the current year: Billable professional staff salaries $ 4,000,000 Overhead 8,000,000 Total costs $ 12,000,000 The overhead costs were as follows
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