Braden Brothers Inc is an architecture firm specializing in high-rise buildings. Its job-costing system has a single direct-cost category (architectural
labor) and a single indirect-cost pool which contains all costs of supporting the office. Support costs are allocated to individual jobs using architectural
labor-hours. Braden Brothers employs 15 architects.
Braden Brothers Inc.
Budget for 2010
Architect labor cost $2880000
Office support costs $1728000
Architect labor-hours billed to clients 32000 hours
Actual results for 2010
Office support costs $1729500
Architect labor hours billed to clients 34590 hours
Actual architect labor cost rate $92 per hour
Compute the direct-cost rate and the indirect-cost rate per architectural labor-hour for 2010 under (a) actual costing (b) normal costing and (c) the
variation from normal costing that uses budgeted rates for direct costs.
How do I find direct-cost rate for this question? I am probably overthinking this problem but would really appreciate any help.