Smith and Jones CPA firm employs 12 accountants and 10 paraprofessionals. Direct and indirect costs...
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Accounting
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
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