E9.3 (LO 2), AP Service Service Thome and Crede, CPAs, are preparing their service revenue (sales) budget for the coming year(2022). The practice is divided into three departments: auditing, tax, and consulting. Billable hours for each department, by quarter, areprovided here.DepartmentAuditingTaxQuarter 12,3003,0001,500Quarter 21,6002,2001,500Quarter 32,0002,0001,500Quarter 42,4002,5001,500ConsultingAverage hourly billing rates are auditing $80, tax $90, and consulting $110.InstructionsPrepare the service revenue (sales) budget for 2022 by listing the departments and showing billable hours, billable rate, and total revenuefor each quarter and the year in total.

Answered: E9.3 (LO 2), AP Service Service Thome…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter7: Allocating Costs Of Support Departments And Joint Products

Section: Chapter Questions

Problem 30E: A company uses charging rates to allocate service department costs to the using departments. The...

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E9.3 (LO 2), AP Service Service Thome and Crede, CPAs, are preparing their service revenue (sales) budget for the coming year
(2022). The practice is divided into three departments: auditing, tax, and consulting. Billable hours for each department, by quarter, are
provided here.
Department
Auditing
Tax
Quarter 1
2,300
3,000
1,500
Quarter 2
1,600
2,200
1,500
Quarter 3
2,000
2,000
1,500
Quarter 4
2,400
2,500
1,500
Consulting
Average hourly billing rates are auditing $80, tax $90, and consulting $110.
Instructions
Prepare the service revenue (sales) budget for 2022 by listing the departments and showing billable hours, billable rate, and total revenue
for each quarter and the year in total.

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Step 1

A spending plan based on income and costs is called a budget. In other words, it's a projection of your income and expenses for a specific time frame, like a month or a year. Or, if you're keeping track of the money coming in and going out of your home as a whole, that's a family budget. Making a detailed list of expenses or concentrating on a few areas may both be part of budgeting. While some individuals prefer to use a spreadsheet or budgeting tool, others prefer to write out their budgets by hand. Budgeting is not an exact science; what works for one person undoubtedly may not work for another.

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