Professional Labor Cost Budget for a Service Company Rollins and Cohen, CPAs, of

Question

Professional Labor Cost Budget for a Service Company Rollins and Cohen, CPAs, offer three types of services to clients: auditing, tax, and small business accounting. Based on experience and projected growth, the following billable hours have been estimated for the year ending December 31, 20Y8: Billable Hours Audit Department: Staff 33,600 Partners 5,000 Tax Department: Staff 24,500 Partners 3,100 Small Business Accounting Department: Staff 4,700 Partners 700 Based on the data provided above and assuming that the average compensation per hour for staff is $55 and for partners is $150, prepare a professional labor cost budget for each department for Rollins and Cohen, CPAs, for the year ending December 31, 20Y8

Explanation / Answer

Professional labour cost budget :

Staff Partners Audit department hours 33600 5000 Tax department hours 24500 3100 Small business accounting department hours 4700 700 Total hours 62800 8800 Average compensation per hour 55 150 Total professional labour cost 3454000 1320000

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