Chirko & 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. Chirko & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2017 are as follows: Budget for 2017 Professional labor compensation - $990,000 Audit support department costs - $774,000 Professional labor hours billed to clients - 18,000 hours Actual results for 2017 Audit support department costs - $735,000 Professional labor hours billed to clients - 17,500 hours Actual professional labor cost rate - $59 per hour Chirko's 2017 audit of Pierre & Co. was budgeted to take 140 hours of professional labor time. The actual professional labor time spent on the audit was 160 hours. Compute the cost of the Pierre & Co. audit using actual costing.

Cornerstones of Cost Management (Cornerstones Series)
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Author:Don R. Hansen, Maryanne M. Mowen
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Chapter7: Allocating Costs Of Support Departments And Joint Products
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Chirko & 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. Chirko &
Partners employs 10 professionals to perform audit services. Budgeted and
actual amounts for 2017 are as follows:
Budget for 2017
Professional labor compensation - $990,000
Audit support department costs - $774,000
Professional labor hours billed to clients - 18,000 hours
Actual results for 2017
Audit support department costs - $735,000
Professional labor hours billed to clients - 17,500 hours
Actual professional labor cost rate - $59 per hour
Chirko's 2017 audit of Pierre & Co. was budgeted to take 140 hours of
professional labor time. The actual professional labor time spent on the audit
was 160 hours.
Compute the cost of the Pierre & Co. audit using actual costing.
Transcribed Image Text:Chirko & 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. Chirko & Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2017 are as follows: Budget for 2017 Professional labor compensation - $990,000 Audit support department costs - $774,000 Professional labor hours billed to clients - 18,000 hours Actual results for 2017 Audit support department costs - $735,000 Professional labor hours billed to clients - 17,500 hours Actual professional labor cost rate - $59 per hour Chirko's 2017 audit of Pierre & Co. was budgeted to take 140 hours of professional labor time. The actual professional labor time spent on the audit was 160 hours. Compute the cost of the Pierre & Co. audit using actual costing.
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