assume that total support cost is considered a unit level cost based on number of wo 641310

(Levels of costs) Leopold & Olney LLP has 5 partners and 12 staff accountants. The partners each work 2,100 hours per year and earn $350,000 annually. The staffaccountant seach work 2,600 hours per year and earn $80,000 annually. The firm’s total annual budget for professional support available to partners and staff accountants is $312,750. The firm also spends $125,100 for administrative support that is used only by the partners.

a. Assume that total support cost is considered a unit level cost based on number of work hours. What is the support rate per labor hour?

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b. If an audit engagement requires 60 partner hours and 220 staff accountant hours, how much professional support cost would be charged to the engagement using the rate determined in (a)?

c. Assume that support costs are considered batch level costs based on number of work hours. What are the support rates per labor hour? (Round to the nearest cent.)

d. If an audit engagement requires 60 partner hours and 220 staff accountant hours, how much support cost would be charged to the engagement using the rates deter mined in (c)?

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