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The law firm of Taub &Lawson, LLP, currently has four cases in process. Following is information related to those cases as of the end of March 2010:
Case # 1 Case # 2 Case # 3 Case # 4
Direct Material $480 $8,800 $3,700 $850
Direct labor hours (190 per hour) 40 90 70 15
Estimated court hours 12 65 120 40
Taub &Lawson allocates overhead to cases based on a predetermined rate of $150 per estimated cour hour.
a. Determine the total cost assigned to each case as of March 31, 2010.
b. Case # 3 was completed at the end of April 2010. At that time, $10,100 of direct materials had been used and 174 direct labor hours had been incurred. Of the DLHs,72 had been spent in court. Taub &Lawson's policy is to charge clients costs plus 45 percent. What amount will be billed to the client involved in Case # 3?
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