Question

4,264 The White Group (WG) provides tax advice to multinational firms. WG charges clients for (a) direct professional time (at WG has just prepared the May 2017 bills for two clients. The hours of professional time spent on each client are as an hourly rate) and (b) support services (at 30% of the direct professional costs billed). The three professionals in WG follows: and their rates per professional hour are as follows: (Click the icon to view the hours by client.) (Click the icon to view the hourly rates.) * Data Table Read the requirements, Montel White $ 10,920 S 3.276 $ 14.196 $ 1,560 S 468 $ 2,028 Ann Borzi 840 252 1,092 2,310 693 3,003 Professional Billing Rato per Hour Jason Alonso 2.400 720 3,120 3,280 984 Montel White $ $ 520 s 18.408 Total $ $ 9,295 Ann Borzi 210 Requirement 2. Suppose support services were billed at $60 per professional labor-hour (instead of 30% of professional labor costs). How would this change affect the amounts WG Jason Alonso 80 differences between the amounts billed in requirements 1 and 2. Determine the formula needed to calculate the total cost per professional for each client when WG allocates support costs at $60 per professional labor-hour. (Abbreviations used: hrs. Print Done Direct professional labor + Support cost per hour * Direct hrs, by professional ) = Cost per professional Complete the table below to determine what WG would have billed to South Beach Dominion and Frankfurt Enterprises for May 2017 if support services were billed at S60 per professional labor-hour (instead of 30% of professional labor costs). Begin with South Beach Dominion i Data Table South Beach Dominion Direct Amount Professional Support Billed to Costs Costs Client $ 10,920 S 1.260 S 12,180 840 240 1,080 Frankfurt Enterprises Direct Amount Professional Support Billed to Costs Client $ 1,500 Costs Montel White Hours per Client South Beach Dominion Frankfurt Enterprises Professional Ann Borzi 2,310 21 3 Jason Alonso White Borzi 2,400 1,800 3,280 4 11 4,200 $ 17,460 Total 30 41 Alonso 55 55 Total Enter any number in the edit fields and then click Check Answer. parts 2 remaining Print Clear All Done

Answer 1

A B C E G H J K 3 4. 5 6 7 Total Cost per professional for each client Direct Professional Labor + (Support allocation rate * Direct Professional labor) 8 South Beach Dominion Direct Amount Professional Support Costs billed to Costs Client $ 10,920 $ 3,276 $ 14,196 $ 840 $ 252 $ 1,092 $ 2,400 $ 720 $ 3,120 $ 18,408 Frankfurt Enterprises Direct Amount billed Professional Support Costs to Client Costs $ 1,560 5 468 $ 2,028 $ 2,310 $ 693 3,003 $ 3,280 $ 984 $ 4,264 $ 9,295 Montel White Ann Borzi Jason Alonso Total 9 10 11 12 13 14 15 16 17 18 19 Requirement 2 Total Cost per professional for each client Direct Professional Labor + (Support cost per hour * Direct hrs by professional) 20 21 22 23 24 25 South Beach Dominion Direct Amount Professional Support Costs billed to Costs Client $ 10,920 $ 1,260 $ 12,180 $ 840 S 240 S 1,080 $ 2,400 $ 1,800 $ 4,200 $ 17,460 Frankfurt Enterprises Direct Amount billed Professional Support Costs to Client Costs $ 1,560 $ 180 $ 1,740 $ 2,310 $ 660 $ 2,970 $ 3,280 $ 2,460 $ 5,740 $ 10,450 Montel White Ann Borzi Jason Alonso Total

Formulas used

А B D E H 3 4 Total Cost per professional Direct Professional Labor + 5 6 7 South Beach Dominion Frankfurt Enterprises Direct Professional Support Costs Amount billed to Client Support Costs Amount billed to Client 8 Costs Direct Professional Costs 1=3*520 |=11* 210 =41*80 Montel White Ann Borzi Jason Alonso Total |=21*520 =4* 210 1 =30* 80 =C9*30% =C10*30% =C11*30% =C9+D9 =C10+D10 =C11+D11 =SUM(E9:E11) =G9*30% =G10*30% =G11*30% =G9+H9 =G10+H10 =G11+H11 =SUM(19:111) 9 10 11 12 13 14 15 16 17 18 19 Requirement 2 Total Cost per professional Direct Professional Labor + South Beach Dominion Frankfurt Enterprises Direct Direct Professional Support Costs Amount billed to Client Support Costs Amount billed to Client Costs 20 21 22 23 24 25 =3*60 Montel White Ann Borzi Jason Alonso Total =21*520 =4* 210 =30*80 =21*60 =4*60 =30*60 Professional Costs =3*520 =11* 210 =41*80 =C21+D21 =C22+D22 =C23+D23 =SUM(E21:E23) =11*60 =41*60 =G21+H21 =G22+H22 =G23+H23 =SUM(121:123)