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Problem: Chirac ?& 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. Chirac ?& Partners employs 10 professionals to perform audit services. Budgeted and actual amounts for 2017 are as? follows:
Chirac & Partners
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 $56 per hour
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